A BILL to amend and reenact §§ 38.2-517, 46.2-770, 46.2-771, 46.2-772, and 58.1-3524 of the Code of Virginia, relating to motor vehicles; insurance, highway use fee, and tangible personal property tax relief; application to certain vehicles.
HB1281 would amend Virginia law in two main areas: motor vehicle insurance claims and vehicle-related fees and tax relief. On the insurance side, the bill expands the list of prohibited unfair settlement practices to include additional disclosure requirements when insurers or their representatives recommend a repair shop, replacement facility, or manufacturer, and it expressly bars “capping,” defined as setting arbitrary and unreasonable limits on reimbursement for paint and materials. It also clarifies that insurers may not require claimants to use designated facilities or products and must disclose when a third party representative is acting on the insurer’s behalf or when the insurer has a financial interest in a recommended repair facility.
On the transportation and tax side, the bill revises the highway use fee framework for alternative fuel vehicles, electric motor vehicles, and fuel-efficient vehicles. It keeps the annual fee tied to the fuel tax equivalent for a 23.7 mpg vehicle and requires the Department of Motor Vehicles to administer a process for contesting assessed fees and to reimburse incorrectly collected amounts. The bill also preserves exemptions for certain vehicles, including motorcycles, mopeds, autocycles, vehicles over 10,000 pounds, government-owned vehicles, and vehicles registered under the International Registration Plan, while maintaining a reduced fee for low-speed vehicles and a refund mechanism when a vehicle owner qualifies for a registration refund.
The bill’s impact on state law would be to tighten consumer protections in auto insurance claim handling and to adjust how Virginia assesses and administers highway use fees for newer vehicle types. It would affect insurers, third-party claims administrators, repair facilities, vehicle owners, and the Department of Motor Vehicles, while also interacting with existing provisions on motor vehicle registration, insurance settlement practices, and the Commonwealth’s transportation funding structure.
The available legislative context shows no recorded committee discussion or votes, and the bill was left in the House Transportation Committee. That suggests the measure did not advance out of committee, and there is no documented floor-level sentiment in the provided materials. Based on the text alone, the bill appears to combine consumer-protection provisions with user-fee adjustments, which can attract support from motorists and repair advocates but may raise concerns from insurers and owners of electric or fuel-efficient vehicles who would face or continue to face annual highway use fees.
The main points of contention are likely to be the insurance reimbursement and disclosure mandates, especially the prohibition on capping and the limits on steering claimants to preferred repair networks, as well as the fairness of imposing annual highway use fees on alternative fuel, electric, and fuel-efficient vehicles. Supporters would likely emphasize transparency, consumer choice, and equitable transportation funding, while opponents may argue the bill increases regulatory burdens on insurers or imposes additional costs on cleaner vehicles.
HB1281 would amend §§ 38.2-517, 46.2-770, 46.2-771, 46.2-772, and 58.1-3524 of the Code of Virginia. In practice, it would broaden the scope of unfair claims settlement practices under Virginia insurance law, create additional disclosure obligations for insurers and their representatives, and make insurers accountable for certain conduct by third-party representatives. It would also refine the highway use fee regime for alternative fuel, electric, and fuel-efficient vehicles, including fee calculation, annual updates, contest procedures, refund rules, and exemptions for specified vehicle categories.
The provided record shows no committee transcript and no votes, and the bill was left in the House Transportation Committee. As a result, there is no formal recorded sentiment from debate or roll call in the supplied materials. The bill’s structure suggests a mixed policy package that could draw support from consumer advocates and transportation-funding proponents, while also prompting resistance from insurers and owners of vehicles subject to the highway use fee.
The likely areas of contention are the insurance provisions and the vehicle fee provisions. Insurers may object to the expanded disclosure duties, the ban on capping, and the restriction on steering claimants to designated repair facilities, while repair shops and consumer advocates may support those changes. Separately, owners of electric, alternative fuel, and fuel-efficient vehicles may oppose the annual highway use fee as an added cost, while supporters may argue that such vehicles should contribute more equitably to highway funding because they use the roads but pay less or no fuel tax.