House to give auto dealers a break from federal rules

The House will vote as early as Monday on legislation that would spare U.S. auto dealers from rules that require them to provide customers with detailed information on auto insurance rates.

The rule was required under a 1972 law, and put in place in a 1993 rule from the National Highway Traffic Safety Administration (NHTSA). It requires the NHTSA to produce a booklet containing insurance information and make it available to auto deals for their customers around the country.

But according to auto dealers, customers don't ever ask for the booklet, which means the NHTSA and auto dealers are required to spend money and time for nothing. Rep. Mike Kelly (R-Pa.), a former auto dealer, testified with others in a June hearing before the House Energy & Commerce Committee by saying that he does not recall any customer asking for the booklet during his many years in the industry.

"The information required by the regulation is rarely sought by consumers and its value to consumers in estimating insurance premiums is questionable," according to the Committee's report on the bill.

"The insurance cost data is general, averaging repair costs from incidents ranging from a low-speed fender collision to a vehicle rollover," it added. "Insurance premiums are based on a number of factors that are unrelated to a vehicle's damage susceptibility, including the driver's age, driving record, location, and miles driven."

The House will consider the bill, H.R. 5859, under a suspension of the rules, which will require passage by a two-thirds majority vote.

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