(a) A person who carries passengers, freight for hire intrastate in a commercial motor vehicle, a person who carries freight in a motor vehicle for commercial purposes, or a person who rents or leases a motor vehicle for the use of another to carry freight shall procure and maintain security in the following minimum amounts:

(1) $200,000 for property damage in a single occurrence;

(2) $500,000 for bodily injury or death in a single occurrence.

(b) Evidence of security required under (a) of this section shall be filed with the department and must be

(1) a policy or certificate of insurance issued by an insurer acceptable to the department;

(2) a bond of a surety company licensed to write surety bonds in the state;

(3) evidence accepted by the department, showing ability to self-insure; or

(4) other security approved by the department.

(c) The department shall adopt regulations necessary to carry out the provisions of this section. The department may authorize department personnel to enforce this section and may adopt procedural regulations necessary to implement this section.

(d) A policy of insurance, surety bond, or other form of security may not be canceled on less than 30 days' written notice to the department. This requirement must be clearly stated in the policy or endorsement for an insurance policy submitted as proof of financial responsibility under (b)(1) of this section. The 30-day notice period is measured from the date on which the department receives notice.

(e) When operating a commercial motor vehicle or motor vehicle for which security is required under (a) of this section, a person shall carry proof of insurance and, if involved in an accident with another person, shall display the proof of insurance to the other person. In this subsection, “proof of insurance” means a

(1) certificate of self-insurance acceptable to the department;

(2) card issued by an insurer described in (b)(1) of this section that indicates that insurance has been procured as required by this section, that contains a local or toll-free telephone number for filing or receiving claim information, and that indicates the name and address of the insurer; or

(3) copy of the surety bond described in (b)(2) of this section.

(f) Notwithstanding AS 19.10.399, in this section

(1) “commercial motor vehicle” means a motor vehicle or a combination of a motor vehicle and one or more other vehicles

(A) used to transport passengers or property for commercial purposes;

(B) used on a land highway or vehicular way or area;

(C) that

(i) has a gross vehicle weight rating or gross combination weight rating greater than 26,000 pounds; or

(ii) is designed to transport more than 15 passengers, including the driver; and

(D) except that the following vehicles meeting the criteria in (A) - (C) of this paragraph are not commercial motor vehicles:

(i) emergency or fire equipment that is necessary to the preservation of life or property;

(ii) covered farm vehicles operating anywhere in the state; and

(iii) vehicles used exclusively for purposes other than commercial purposes;

(2) “freight” means commodities, articles, and cargo, of whatever nature or value.

(g) A person who violates (a) of this section is guilty of a class B misdemeanor and is punishable by a fine of not less than $500 or more than $1,000.