November 21, 1979
Subject:
Motor Vehicles; Financial Responsibility, Minimum Amounts
Requested By:
Mr. J. M. Penny Deputy Commissioner of Motor Vehicles
Question:
Chapter 832 of the 1979 Session Laws increases the minimum insurance required under the Motor Vehicle Safety and Financial Responsibility Act. What is the effective date of this act and what affect will it have on policies in effect on the effective date?
Conclusion:
The effective date of Chapter 832 of the 1979 Session Laws is January 1, 1980, and it has no affect on policies in effect prior thereto.
Chapter 832 of the 1979 Session Laws of North Carolina, effective January 1, 1980, raises the minimum amounts of financial responsibility for automobile liability insurance required under the Motor Vehicle Safety and Financial Responsibility Act from $15,000.00 – $30,000.00 $5,000.00 to $25,000.00 – $50,000.00 – $10,000.00. The portions of the act relevant to the question presented read:
"Sec. 12. This act will not affect any policy in effect on the effective date of this act nor will this act affect pending litigation.
Sec. 13. This act shall become effective on January 1, 1980."
Since an insurance policy issued prior to January 1, 1980 would not be affected by the act, the act is prospective and has no retroactive effect. The new limits will apply only to insurance policies issued with an effective date of 12:01 A.M., January 1, 1980, and thereafter. Chapter 832 of the 1979 Session Laws does not require that the limits of an automobile liability insurance policy in effect prior to January 1, 1980, which met the minimum requirements of the Motor Vehicle Safety and Financial Responsibility Act prior to that date, be raised until the annual renewal period occurring in 1980 or thereafter.
Rufus L. Edmisten Attorney General
William W. Melvin Deputy Attorney General