For Officials: Policy Briefing & Action Agenda

Overview

Federal Claims Advisors, LLC presents this briefing for state and federal officials regarding a systemic failure in Colorado’s financial responsibility framework.

Our research operates at the intersection of public safety and insurance integrity, identifying a pervasive pattern in which commercial work is performed under personal auto insurance policies that frequently fail once a serious crash occurs.

Current initiatives focus on the structural defects that arise when:

  • Commercial risk is misclassified
    Vehicles used for contracting, construction, trades, and delivery are insured under personal auto policies to avoid commercial premiums

  • Coverage is illusory
    Insurers deny or sharply limit claims based on undisclosed “business use” exclusions following catastrophic crashes, leaving victims uncompensated

  • Regulatory systems are blind
    Insurance verification databases track registration status but do not reliably detect when a “private” vehicle is functioning as an unregistered commercial fleet unit

The Mechanics of the Coverage Gap

While the U.S. Department of Transportation audits Colorado’s compliance with Commercial Driver’s License (CDL) standards to protect public safety, a parallel safety crisis remains largely unaddressed: financial responsibility integrity.

Our investigation reveals a recurring cycle that shifts commercial liability away from businesses and onto victims and taxpayers:

  • The setup
    Employers encourage or require workers to use personal heavy-duty trucks or vans for commercial tasks

  • The exclusion
    Personal auto policies contain “business use” or “livery” exclusions that void or restrict coverage when a vehicle is used for work

  • The outcome
    When crashes occur, insurers deny coverage or limit payment to statutory minimums that are inadequate for modern trauma care, long-term disability, or wrongful death

The result is predictable and systemic: commercial risk is externalized, and the costs are absorbed by injured families, hospitals, Medicaid, and uncompensated care pools.

Action Agenda

We urge state and federal officials to address this defect with the same urgency currently applied to driver licensing and roadway safety.

State Executive Action

We request that the Governor of Colorado and the Division of Insurance convene a Work Vehicle Insurance Integrity Task Force with authority to:

  • Quantify the gap
    Produce a public report within 30 days detailing the frequency and outcomes of “business use” coverage denials and disputes in Colorado vehicle crashes

  • Close the loophole
    Direct DORA and the Department of Motor Vehicles to publish clear enforcement protocols for vehicle misclassification and to close reporting blind spots in the Motorist Insurance Identification Database (MIIDB)

  • Modernize mandatory limits
    Support legislation to update Colorado’s mandatory minimum liability limits, which currently leave residents functionally underinsured in the event of serious injury

Federal Oversight

We request that the U.S. Department of Transportation expand the scope of its current oversight efforts to include insurance integrity and financial responsibility compliance.

Specifically, we ask that DOT and FMCSA:

  • Audit financial responsibility
    Assess whether high-risk operators and employers deploying workers in vehicles maintain and can prove appropriate insurance coverage for the work performed

  • Commission a national inquiry
    Collect data on the downstream transfer of commercial crash costs to Medicaid, uncompensated care systems, and victim families when coverage is denied or limited

  • Issue federal guidance to states
    Publish best-practice recommendations to ensure that work-related vehicle use does not evade appropriate insurance classification and verification

Briefing Materials & Resources

Primary research, correspondence, and model reform materials will be available for download here:

  • [DOWNLOAD] White Paper: The Public Safety Crisis in Colorado’s Auto Insurance System (Aug. 2025)
    Legal analysis of illusory coverage, systemic misclassification, and statutory failures enabling the coverage gap

  • [DOWNLOAD] Report: Work-Related Use of Personal Vehicles in Colorado
    Detailed examination of personal auto policies, scope-of-employment doctrines, and liability exclusions

  • [DOWNLOAD] Letter to U.S. Secretary of Transportation
    Formal request for federal oversight and inclusion of insurance integrity in safety audits

  • [DOWNLOAD] Letter to Governor of Colorado
    Request for executive action, transparency, and corrective policy measures

(Links to be added once files are finalized in the Public Documents folder.)

Legal Authorities (Links forthcoming)

This advocacy is grounded in established state and federal law, including:

  • Colorado compulsory insurance and financial responsibility statutes

  • Mandatory disclosure and unfair insurance practices provisions

  • Medical payments coverage requirements

  • Federal motor carrier financial responsibility regulations

(Direct links will be posted once document hosting is complete.)

Contact

Federal Claims Advisors, LLC
Public Safety • Financial Responsibility • System Integrity

For legislative briefings, agency inquiries, media requests, or documented cases involving coverage denials related to work-use vehicle crashes, please contact us:

Learn more

Letter to U.S. Dept. of Transportation Secretary Sean Duffy

Subject: Request to Expand DOT/FMCSA Commercial Driver Safety Audits to Include Insurance Compliance & Financial Responsibility Integrity

December 23, 2025

The Honorable Sean Duffy
U.S. Secretary of Transportation
U.S. Department of Transportation
1200 New Jersey Avenue, SE
Washington, DC 20590

Secretary Duffy:

We write as Colorado residents directly impacted by a dangerous, recurring gap in road-safety accountability: vehicles driven for business purposes that appear “insured” for registration yet may be effectively uninsured or underinsured for the very work being performed.

Your Department’s current enforcement posture—highlighted by the nationwide compliance review of commercial driver licensing and the public-safety warnings directed to Colorado—has elevated an urgent question Colorado has not answered: who verifies that a “working vehicle” is insured as a working vehicle—and who is accountable when it is not? (See reporting: Colorado Public Radio; Associated Press.)

Colorado relies on the Motorist Insurance Identification Database (MIIDB) / “Drive Insured” system to reduce uninsured driving and support verification. (See Drive Insured FAQs.) Yet Colorado MIIDB materials describe a commercially insured vehicle filing exemption—optional reporting by commercial providers—which creates a blind spot precisely where public risk and claim severity are highest. (See MIIDB Commercial Exemption Notice; MIIDB User Guide.)

At the same time, the insurance market widely recognizes that personal auto policies often exclude or restrict coverage when a vehicle is used for commercial/livery purposes, creating predictable coverage gaps when real-world use differs from policy classification. (See NAIC: Commercial Ride-Sharing / Livery & Commercial Use Exclusions.)

We respectfully request that DOT/FMCSA take the following actions:

  1. Add an insurance-compliance / financial-responsibility integrity module to ongoing safety and compliance efforts—focused on whether operators (including contractors deploying workers in vehicles for business) maintain and can prove appropriate financial responsibility for the work performed, and whether state systems can reliably identify and deter misclassification. For context on federal financial responsibility baselines for motor carriers, see 49 C.F.R. Part 387 (PDF) and FMCSA’s overview: FMCSA Safety Planner: Part 387.
  2. Require state reporting on the “work-use coverage gap,” including (a) how states detect/flag vehicles used primarily for business but insured as personal autos, and (b) outcome data where business use emerges post-crash and coverage is denied, limited, or disputed.
  3. Publish federal guidance to states (DOT/FMCSA/NHTSA working group recommended) on best practices for ensuring that work-related vehicle use does not evade appropriate insurance classification, including recommended data elements for verification systems.
  4. Convene a federal–state working group with state motor-vehicle agencies and insurance regulators (including NAIC participation) to develop a model framework that makes “mandatory insurance” meaningful for the public when commercial activity is involved.

We are prepared to provide a concise packet including: (1) our Colorado white paper, (2) a case timeline and documentary exhibits, and (3) a proposed reform framework (the “Work Vehicle Insurance Responsibility” concept).

Please confirm receipt and identify a point of contact for next steps and scheduling.

Respectfully,

Christopher M. Sullivan, Esq.
Federal Claims Advisors, LLC
director@federalclaims.us • Tel. (303) 351-1777

Attachments (available upon request / via our website):
(A) White Paper: The Public Safety Crisis in Colorado’s Auto Insurance System (Aug. 2025)
(B) Work-Related Use of Personal Vehicles in Colorado: Insurance Coverage and Liability

Companion Letter to Colorado Governor Jared Polis

Subject: Immediate Public-Safety Action Needed: Work Vehicles Insured as “Personal” and the Coverage Gap Risk to Colorado Families

December 23, 2025

Governor Jared Polis
Office of the Governor
200 E. Colfax Ave., Room 136
Denver, CO 80203

Governor Polis:

Colorado’s compulsory insurance system is intended to protect the public by ensuring financial responsibility on our roads. (See Colorado’s Compulsory Insurance Law reference: Colorado Department of Revenue – Auto Insurance.) Yet Colorado families face a predictable and preventable risk: vehicles used for business are frequently insured as “personal,” and coverage may be denied, limited, or disputed when work-use facts emerge after a serious crash.

Colorado relies on the Motorist Insurance Identification Database (MIIDB) / Drive Insured program for insurance verification. (See Drive Insured FAQs.) However, Colorado MIIDB materials describe a commercially insured vehicle filing exemption—optional reporting by commercial providers—which can create an information blind spot at exactly the point where risk and losses are highest. (See MIIDB Commercial Exemption Notice.)

Colorado has already recognized the underlying problem: the Division of Insurance issued Emergency Regulation 20-E-03 addressing restrictions/exclusions in personal auto coverage for commercial food delivery during a public emergency, reflecting the public-interest nature of coverage integrity. (See DOI Emergency Regulation 20-E-03 (PDF).)

We request immediate executive action:

  1. Convene a 30-day Work Vehicle Insurance Integrity Task Force (DORA/DOI + DMV + AG + CSP + CDOT + DAs) to deliver: (a) a public report quantifying the work-use coverage gap, and (b) a draft reform package to close it.
  2. Direct DORA/DOI and DMV to publish a clear written explanation of how “work use” is captured (or not captured) in Colorado’s verification ecosystem, and what enforcement options exist when vehicles are misclassified.
  3. Support legislation requiring employers/contractors who benefit from work driving to certify appropriate coverage and promptly disclose all applicable policies after a crash (including pre-suit disclosure tools Colorado already provides, such as C.R.S. 10-3-1117: C.R.S. 10-3-1117).

We are prepared to provide a short briefing packet and meet with your staff immediately.

Respectfully,

Christopher M. Sullivan, Esq.
Federal Claims Advisors, LLC
director@federalclaims.us • Tel. (303) 351-1777