V. Failure to Maintain Proof of Insurance (Phase II)

CPSD contends that Starving Students did not maintain proper insurance in effect and on file with the Commission. Under Pub. Util. Code § 5286 it is unlawful for a household goods carrier to operate as a carrier when its permit is suspended. Commission staff suspended Starving Students permit on three occasions for failure to maintain proof of insurance on file. On two occasions, Starving Students failed to maintain proof of its liability insurance, and one instance involved its workers' compensation insurance.

Starving Students was suspended for failure to maintain proof of liability insurance effective October 1, 1999 and reinstated on November 3, 1999, after it filed proof of insurance. Starving Students continued to operate during that period. (Exhibit 10, Attachments S, T.) On December 8, 1999, Starving Students was suspended for failure to maintain proof of liability insurance. Starving Students was reinstated effective December 10, 1999. Starving Students continued to operate during that period. (Exhibit 10, Attachments U, V.) On August 31, 2000, Starving Students was suspended for failure to maintain proof of workers' compensation insurance. Starving Students was reinstated effective September 13, 2000. Starving Students continued to operate during that period. (Exhibit 10, Attachments W, X.)

Starving Students believed that evidence of its insurance was timely filed. Starving Students introduced insurance brokers' letters to demonstrate that it had business auto and workers' compensation policies in effect during the above-discussed periods. (Exhibits 19, 20, 21, 34 (duplicate).) Starving Students also introduced a copy of a certificate of insurance, filed at the Commission that has two date stamps, November 30, 1999 and December 10, 1999. (Exhibit 29, Tab F.) The earlier date stamp is in the box reserved for the Commission to stamp "date received." CPSD countered with notices of cancellation. (Exhibits 43, 45.) Although Starving Students' auto liability and property damage insurance changed two times between October 1 and November 25, 1999, it appears Starving Students had coverage in effect during the suspension periods.

Starving Students also provided a letter it received from its insurance agent confirming workers' compensation coverage effective January 1, 2000. CPSD introduced the Commission's license section's letter to a prior workers' compensation insurance carrier, requesting proof of insurance or cancellation and that carrier's notice of cancellation effective January 1, 1999. (Exhibits 41 and 42.) It appears Starving Students had workers' compensation coverage in effect during the period of suspension but Starving Students did not establish that it had coverage between January 2, 1999 and January 1, 2000.

The Commission did not have proof of insurance on file during two periods but appears to have had proof of insurance on file during the shortest period of suspension, two days. Starving Students appears to have had insurance coverage in effect during all suspension periods. Starving Students was suspended a total of 45 days for the three policies and unlawfully continued to operate during those periods. However, the Commission appears to have received proof of auto liability and property damage insurance prior to suspending Starving Students from December 8 to December 10, 1999.