Bill Text: IN SB0231 | 2011 | Regular Session | Introduced
Bill Title: Motor vehicle repair insurance claims.
Spectrum: Partisan Bill (Republican 3-0)
Status: (Introduced - Dead) 2011-01-11 - Senators Smith and Grooms added as coauthors [SB0231 Detail]
Download: Indiana-2011-SB0231-Introduced.html
Citations Affected: IC 27-4-1-4.5; IC 27-7-6.1.
Synopsis: Motor vehicle repair insurance claims. Requires a motor
vehicle insurer to provide certain notice and payment with respect to
a motor vehicle repair claim.
Effective: July 1, 2011.
January 6, 2011, read first time and referred to Committee on Insurance and Financial
Institutions.
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A BILL FOR AN ACT to amend the Indiana Code concerning
insurance.
(1) Misrepresenting pertinent facts or insurance policy provisions relating to coverages at issue.
(2) Failing to acknowledge and act reasonably promptly upon communications with respect to claims arising under insurance policies.
(3) Failing to adopt and implement reasonable standards for the prompt investigation of claims arising under insurance policies.
(4) Refusing to pay claims without conducting a reasonable investigation based upon all available information.
(5) Failing to affirm or deny coverage of claims within a reasonable time after proof of loss statements have been completed.
(6) Not attempting in good faith to effectuate prompt, fair, and equitable settlements of claims in which liability has become
reasonably clear.
(7) Compelling insureds to institute litigation to recover amounts
due under an insurance policy by offering substantially less than
the amounts ultimately recovered in actions brought by such
insureds.
(8) Attempting to settle a claim for less than the amount to which
a reasonable individual would have believed the individual was
entitled by reference to written or printed advertising material
accompanying or made part of an application.
(9) Attempting to settle claims on the basis of an application that
was altered without notice to or knowledge or consent of the
insured.
(10) Making claims payments to insureds or beneficiaries not
accompanied by a statement setting forth the coverage under
which the payments are being made.
(11) Making known to insureds or claimants a policy of appealing
from arbitration awards in favor of insureds or claimants for the
purpose of compelling them to accept settlements or compromises
less than the amount awarded in arbitration.
(12) Delaying the investigation or payment of claims by requiring
an insured, a claimant, or the physician of either to submit a
preliminary claim report and then requiring the subsequent
submission of formal proof of loss forms, both of which
submissions contain substantially the same information.
(13) Failing to promptly settle claims, where liability has become
reasonably clear, under one (1) portion of the insurance policy
coverage in order to influence settlements under other portions of
the insurance policy coverage.
(14) Failing to promptly provide a reasonable explanation of the
basis in the insurance policy in relation to the facts or applicable
law for denial of a claim or for the offer of a compromise
settlement.
(15) In negotiations concerning liability insurance claims,
ascribing a percentage of fault to a person seeking to recover from
an insured party, in spite of an obvious absence of fault on the
part of that person.
(16) The unfair claims claim settlement practices defined in
IC 27-4-1.5 and IC 27-7-6.1.
Chapter 6.1. Motor Vehicle Repair Claim Processing
Sec. 1. As used in this chapter, "authorized claim" means a claim that:
(1) is made for payment under a policy of motor vehicle insurance for a repair to a motor vehicle; and
(2) has been authorized by the insurer that is responsible for paying the claim.
Sec. 2. As used in this chapter, "insurer" means an insurer that issues a policy of motor vehicle insurance.
Sec. 3. As used in this chapter, "loss payee" means a person that is specified on a policy of motor vehicle insurance as an additional insured or a loss payee.
Sec. 4. As used in this chapter, "policy of motor vehicle insurance" means a policy that provides the kind of insurance described in Class 2(f) of IC 27-1-5-1.
Sec. 5. As used in this chapter, "repair facility" means a business that completes a repair that is the subject of an authorized claim.
Sec. 6. (a) If:
(1) a motor vehicle is subject to a lien, an insurer that is responsible for payment of an authorized claim shall:
(A) not issue payment to the policyholder;
(B) issue the authorized claim payment, and any related supplemental payment, only to the repair facility for completed repairs; and
(C) provide written notice of completion of the repair to a loss payee less than thirty (30) days after the date the repair is completed; and
(2) a motor vehicle is not subject to a lien, an insurer that is responsible for payment of an authorized claim shall:
(A) not issue payment to the policyholder for repairs completed by a repair facility; and
(B) issue the authorized claim payment, and any related supplemental payment, for completed repairs directly to the repair facility, naming both the policyholder and the repair facility as payees.
(b) An insurer that violates subsection (a) commits an unfair claim settlement practice under IC 27-4-1-4.5.
(c) An insurer that does not issue payment naming the repair facility as required by subsection (a) is liable to the repair facility for the greater of the following:
(1) Two (2) times the actual damages incurred by the policyholder.
(2) Five hundred dollars ($500), plus attorney fees.
Sec. 7. A repair facility's endorsement of a payment instrument tendered under section 6 of this chapter is certification by the repair facility of completion of the repair that is the subject of the authorized claim.