When director may release proof of financial responsibility

(1) The director, upon request, shall cancel any bond or return any certificate of insurance, or the director shall direct and the state treasurer shall return to the person entitled thereto any money or securities deposited pursuant to this article 7 as proof of financial responsibility, or waive the requirement of filing proof of financial responsibility in any of the following events: (a) At any time after three years from the date such proof was required, or after any other period during which proof was required pursuant to section 42-7-408 (1) in the case of certain violations for an alcohol-related driving offense, if, during such three-year or other period preceding the request, the person furnishing such proof has not been convicted of any offense referred to in section 42-7-406; or (b) In the event of the death of the person on whose behalf such proof was filed, or the permanent incapacity of such person to operate a motor vehicle; or (c) In the event the person who has given proof of financial responsibility surrenders the person's license to the director, but the director shall not release such proof in the event any action for damages upon a liability referred to in this article 7 is then pending or any judgment upon any such liability is then outstanding and unsatisfied or in the event the director has received notice that such person has within the period of three months immediately preceding been involved as a driver in any motor vehicle crash. An affidavit of the applicant of the nonexistence of such facts is sufficient evidence thereof in the absence of evidence to the contrary in the records of the department. (2) Whenever any person to whom proof has been surrendered, as provided in paragraph (c) of subsection (1) of this section, applies for a license within a period of three years from the date proof of financial responsibility was originally required, or within any other period during which proof of financial responsibility was required pursuant to section 42-7-408 (1), any such application shall be refused unless the applicant establishes such proof for the remainder of such period.