Ahead of the upcoming driving season, “Steve” took his 1958 Porsche 356 “Outlaw” coupe to his favorite local Porsche repair shop for some needed work. Once completed, a short test drive was necessary for the mechanic to verify that everything was working properly.

As the mechanic came to a nearby intersection, he spotted a Mitsubishi 3000GT approaching from the side street and hit the brakes. But the other driver was going a bit too fast and did not see the 356 in time to stop. The Mitsubishi smashed into the Porsche’s left front fender.

The terrified Porsche mechanic called the shop to alert his boss. The Porsche’s fender and the headlight bucket were collapsed to the horn grille, with fender damage extending to the front wheel. The driver of the Mitsubishi was apologetic. When help arrived, he admitted that the crash was his fault, and provided his license and insurance information from Progressive Insurance. The cars were towed off, and the shop called Steve to give him the bad news.

Steve wasn’t much concerned about the financial aspects of the accident. He was insured by Hagerty, the other driver was insured and admitted liability, and the shop carried its own liability policy. With three sources of funding, he was not worried about getting his Porsche properly repaired.

The Progressive adjuster was extremely pleasant and sympathetic, quickly agreeing that the Porsche would go to a local body shop of Steve’s choosing. Several months and $13,000 of Progressive’s money later, the 356 was back on the road, looking none the worse for the wear. The well-qualified body shop was able to pull the fender straight and paint the front end, blending the new paint into the door.

Steve and the repair shop both examined the car closely and pronounced it fully repaired. The mechanic explained that it was fortunate that the impact was mostly from the side, sparing the 356’s delicate and critical front-end architecture from any significant damage.

The other shoe drops

At this point, you’re probably thinking this is some sort of fairytale where the consumer-policy-oriented insurance company performs surprisingly well and everyone is satisfied with the outcome. That’s what Steve thought, too. Except for missing a few months of driving, he was happy. Why, then, are we reading about this in “Legal Files?”

Well, Steve had just started to forget about the whole thing when he received a letter from his state’s DMV informing him that it was suspending his license because he got into an accident while driving without insurance.

Steve went to the DMV headquarters, where after a lengthy wait, he was able to speak to a cordial DMV supervisor. After consulting with someone more knowledgeable about the situation, she explained that the problem arose because Steve failed to file a Traffic Accident and Insurance Report within 72 hours of the incident, as he was required to do under state law.

That report serves two purposes. First, it advises DMV about the accident, the circumstances, the extent of the damage and the identity of the drivers. Second, it establishes that Steve has insurance that will protect the other driver if Steve ends up being the one at fault. When DMV learned of the accident from the other driver and saw that Steve had not filed an accident report, it assumed that Steve was uninsured, triggering the notice of license suspension.

The supervisor accepted Steve’s explanation about the circumstances and his proof of insurance. She told him she would get the license suspension process stopped, but that he needed to get his insurance company to file a Form SR-22. Steve immediately called someone at Hagerty, who said they would get the SR-22 out as soon as possible.

Steve had earlier called his shop about the suspension and asked if anyone there understood what it was about, which they didn’t. When he called back to give them an update, the shop owner screamed, “No, don’t do that! If you file an SR-22, you are admitting liability.”

Confused, Steve called Hagerty back and canceled the SR-22. Then he called “Legal Files” to ask what was going on here.

DMV reporting

A Form SR-22 is a document used by most states to verify that a driver carries insurance that meets the requirements of state law. It is also called a “Certificate of Financial Responsibility.” It is not routinely required of all drivers. Rather, a state requires it to be filed after a driver is caught driving without a license or insurance, has his license suspended, is convicted of drunk driving, has too many accidents, etc. Basically, DMV has reason to view the driver as a risk and is allowed to verify that adequate insurance is in place to protect the public.

There was really no reason for Steve to be required to file an SR-22, and the shop owner was concerned that filing it would serve as an admission that Steve had been driving without insurance. There is certainly some logic to that train of thought, but it really wouldn’t have had that effect. 

Steve would have filed the SR-22 only because DMV asked him to. The reason behind DMV’s request is its business, and Steve doesn’t have to agree with that logic when he does what they ask. But still, Steve was not legally required to file one, and failing to file it would not have any legal consequence.

The more serious question involves the Traffic Accident and Insurance Report. In this case, state law is clear that a driver is required to file this report within 72 hours after an accident that happened on a highway or premises open to the public, and resulted in any of the following:

  • Over $2,500 in damage to your vehicle.
  • Any vehicle has more than $2,500 of damage and is towed from the scene.
  • Over $2,500 in damage to property other than a vehicle.
  • Any person is injured, no matter how minor.
  • Any person is killed.

The form’s instructions state clearly that you are required to file it even if the police are called to the scene and a police report is issued. They state that if you can’t file the form within 72 hours, you should file it as soon as possible. The instructions also advise that the failure to file the form at all can lead to the suspension of your driving privileges.

The form asks for complete information about your insurance, and its instructions state clearly that if you don’t provide complete insurance information, your car will be considered to have been uninsured. That’s how Steve got snagged — by not filing the form he did not provide the insurance information, which meant that he was deemed to be uninsured.

But looking at the form, its instructions and the law, it seems clear that Steve was never required to file this form to begin with. The driver is required to file the form, not the owner of the vehicle. Since the mechanic was driving the Porsche during the accident, it was his responsibility to file this form, not Steve’s.

Be aware

I must confess to having violated this requirement myself, happily without repercussions. Reporting to DMV is not top-of-mind when involved in a minor accident and there isn’t going to be any conflict over who is the responsible party. Furthermore, $2,500 of damage is a low threshold to cross — a scraped bumper can cost as much these days.

The exact requirements for reporting accidents are state-specific, of course, but all states impose some sort of rules. It’s best to be aware of them and comply when the event happens. This can seem tedious and unimportant, and many times it is. But once you get caught in a bureaucratic snag, as Steve did, it’s a much bigger pain to extricate yourself. ♦

John Draneas is an attorney in Oregon and has been SCM’s “Legal Files” columnist since 2003. His recently published book The Best of Legal Files can be purchased on our website. John can be contacted at john@draneaslaw.com. His comments are general in nature and are not intended to substitute for consultation with an attorney.

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