S.B. 122 Enrolled

MOTOR VEHICLE INSURANCE AMENDMENTS
2001 GENERAL SESSION
STATE OF UTAH
Sponsor: Michael G. Waddoups
This act modifies the Insurance Code by limiting underinsured motorist insurance coverage
subrogation and clarifying the conditions for making an uninsured motorist claim.
This act affects sections of Utah Code Annotated 1953 as follows:
AMENDS:
31A-22-305, as last amended by Chapter 188, Laws of Utah 2000
31A-22-307, as last amended by Chapter 71, Laws of Utah 1994
31A-22-309, as last amended by Chapter 222, Laws of Utah 2000
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 31A-22-305 is amended to read:
31A-22-305. Uninsured and underinsured motorist coverage.
(1) As used in this section, "covered persons" includes:
(a) the named insured;
(b) persons related to the named insured by blood, marriage, adoption, or guardianship, who
are residents of the named insured's household, including those who usually make their home in the same
household but temporarily live elsewhere;
(c) any person occupying or using a motor vehicle referred to in the policy or owned by a
self-insurer; and
(d) any person who is entitled to recover damages against the owner or operator of the
uninsured or underinsured motor vehicle because of bodily injury to or death of persons under Subsection
(1)(a), (b), or (c).
(2) As used in this section, "uninsured motor vehicle" includes:
(a) (i) a vehicle, the operation, maintenance, or use of which is not covered under a liability
policy at the time of an injury-causing occurrence; or
(ii) (A) a vehicle covered with lower liability limits than required by Section 31A-22-304 ;

(B) the vehicle described in Subsection (2)(a)(ii)(A) is uninsured to the extent of the deficiency;
(b) an unidentified vehicle that left the scene of an accident proximately caused by the vehicle
operator;
(c) a vehicle covered by a liability policy, but coverage for an accident is disputed by the liability
insurer for more than 60 days or, beginning with the effective date of this act, continues to be disputed for
more than 60 days; or
(d) (i) an insured vehicle if, before or after the accident, the liability insurer of the vehicle is
declared insolvent by a court of competent jurisdiction;
(ii) the vehicle described in Subsection (2)(d)(i) is uninsured only to the extent that the claim against
the insolvent insurer is not paid by a guaranty association or fund.
(3) (a) Uninsured motorist coverage under Subsection 31A-22-302 (1)(b) provides coverage for
covered persons who are legally entitled to recover damages from owners or operators of uninsured motor
vehicles because of bodily injury, sickness, disease, or death.
(b) For new policies written on or after January 1, 2001, the limits of uninsured motorist coverage
shall be equal to the lesser of the limits of the insured's motor vehicle liability coverage or the maximum
uninsured motorist coverage limits available by the insurer under the insured's motor vehicle policy, unless
the insured purchases coverage in a lesser amount by signing an acknowledgment form provided by the
insurer that:
(i) waives the higher coverage;
(ii) reasonably explains the purpose of uninsured motorist coverage; and
(iii) discloses the additional premiums required to purchase uninsured motorist coverage with limits
equal to the lesser of the limits of the insured's motor vehicle liability coverage or the maximum uninsured
motorist coverage limits available by the insurer under the insured's motor vehicle policy.
(c) Uninsured motorist coverage may not be sold with limits that are less than the minimum bodily
injury limits for motor vehicle liability policies under Section 31A-22-304 .
(d) The acknowledgment under Subsection (3)(b) continues for that issuer of the uninsured

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motorist coverage until the insured, in writing, requests different uninsured motorist coverage from the
insurer.
(e) (i) In conjunction with the first two renewal notices sent after January 1, 2001, for policies
existing on that date, the insurer shall disclose in the same medium as the premium renewal notice, an
explanation of the purpose of uninsured motorist coverage and the costs associated with increasing the
coverage in amounts up to and including the maximum amount available by the insurer under the insured's
motor vehicle policy.
(ii) The disclosure shall be sent to all insureds that carry uninsured motorist coverage limits in an
amount less than the insured's motor vehicle liability policy limits or the maximum uninsured motorist
coverage limits available by the insurer under the insured's motor vehicle policy.
(4) (a) (i) Except as provided in Subsection (4)(b), the named insured may reject uninsured
motorist coverage by an express writing to the insurer that provides liability coverage under Subsection
31A-22-302 (1)(a).
(ii) This rejection shall be on a form provided by the insurer that includes a reasonable explanation
of the purpose of uninsured motorist coverage.
(iii) This rejection continues for that issuer of the liability coverage until the insured in writing
requests uninsured motorist coverage from that liability insurer.
(b) (i) All persons, including governmental entities, that are engaged in the business of, or that
accept payment for, transporting natural persons by motor vehicle, and all school districts that provide
transportation services for their students, shall provide coverage for all vehicles used for that purpose, by
purchase of a policy of insurance or by self-insurance, uninsured motorist coverage of at least $25,000 per
person and $500,000 per accident.
(ii) This coverage is secondary to any other insurance covering an injured covered person.
(c) Uninsured motorist coverage:
(i) is secondary to the benefits provided by Title 34A, Chapter 2, Workers' Compensation Act;
(ii) may not be subrogated by the Workers' Compensation insurance carrier;

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(iii) may not be reduced by any benefits provided by Workers' Compensation insurance; and
(iv) may be reduced by health insurance subrogation only after the covered person has been made
whole.
(d) As used in this Subsection (4):
(i) "Governmental entity" has the same meaning as under Section 63-30-2 .
(ii) "Motor vehicle" has the same meaning as under Section 41-1a-102 .
(5) When a covered person alleges that an uninsured motor vehicle under Subsection (2)(b)
proximately caused an accident without touching the covered person or the vehicle occupied by the
covered person, the covered person must show the existence of the uninsured motor vehicle by clear and
convincing evidence consisting of more than the covered person's testimony.
(6) (a) The limit of liability for uninsured motorist coverage for two or more motor vehicles may
not be added together, combined, or stacked to determine the limit of insurance coverage available to an
injured person for any one accident.
(b) (i) Subsection (6)(a) applies to all persons except a covered person as defined under
Subsection (7)(b)(ii).
(ii) A covered person as defined under Subsection (7)(b)(ii) is entitled to the highest limits of
uninsured motorist coverage afforded for any one vehicle that the covered person is the named insured or
an insured family member.
(iii) This coverage shall be in addition to the coverage on the vehicle the covered person is
occupying.
(iv) Neither the primary nor the secondary coverage may be set off against the other.
(c) Coverage on a motor vehicle occupied at the time of an accident shall be primary coverage,
and the coverage elected by a person described under Subsections (1)(a) and (b) shall be secondary
coverage.
(7) (a) Uninsured motorist coverage under this section applies to bodily injury, sickness, disease,
or death of covered persons while occupying or using a motor vehicle only if the motor vehicle is described

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in the policy under which a claim is made, or if the motor vehicle is a newly acquired or replacement vehicle
covered under the terms of the policy. Except as provided in Subsection (6) or (7), a covered person
injured in a vehicle described in a policy that includes uninsured motorist benefits may not elect to collect
uninsured motorist coverage benefits from any other motor vehicle insurance policy under which he is a
covered person.
(b) Each of the following persons may also recover uninsured motorist benefits under any other
policy in which they are described as a "covered person" as defined in Subsection (1):
(i) a covered person injured as a pedestrian by an uninsured motor vehicle; and
(ii) a covered person injured while occupying or using a motor vehicle that is not owned by,
furnished, or available for the regular use of the covered person, the covered person's resident spouse, or
the covered person's resident relative.
(c) A covered person in Subsection (7)(b) is not barred against making subsequent elections if
recovery is unavailable under previous elections.
(8) (a) As used in this section, "underinsured motor vehicle" includes a vehicle, the operation,
maintenance, or use of which is covered under a liability policy at the time of an injury-causing occurrence,
but which has insufficient liability coverage to compensate fully the injured party for all special and general
damages.
(b) The term "underinsured motor vehicle" does not include:
(i) a motor vehicle that is covered under the liability coverage of the same policy that also contains
the underinsured motorist coverage; or
(ii) an uninsured motor vehicle as defined in Subsection (2).
(9) (a) Underinsured motorist coverage under Subsection 31A-22-302 (1)(c) provides coverage
for covered persons who are legally entitled to recover damages from owners or operators of underinsured
motor vehicles because of bodily injury, sickness, disease, or death.
(b) For new policies written on or after January 1, 2001, the limits of underinsured motorist
coverage shall be equal to the lesser of the limits of the insured's motor vehicle liability coverage or the

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maximum underinsured motorist coverage limits available by the insurer under the insured's motor vehicle
policy, unless the insured purchases coverage in a lesser amount by signing an acknowledgment form
provided by the insurer that:
(i) waives the higher coverage;
(ii) reasonably explains the purpose of underinsured motorist coverage; and
(iii) discloses the additional premiums required to purchase underinsured motorist coverage with
limits equal to the lesser of the limits of the insured's motor vehicle liability coverage or the maximum
underinsured motorist coverage limits available by the insurer under the insured's motor vehicle policy.
(c) Underinsured motorist coverage may not be sold with limits that are less than $10,000 for one
person in any one accident and at least $20,000 for two or more persons in any one accident.
(d) The acknowledgment under Subsection (9)(b) continues for that issuer of the underinsured
motorist coverage until the insured, in writing, requests different underinsured motorist coverage from the
insurer.
(e) The named insured's underinsured motorist coverage, as described in Subsection (9)(a), is
secondary to the liability coverage of an owner or operator of an underinsured motor vehicle, as described
in Subsection (8). Underinsured motorist coverage may not be set off against the liability coverage of the
owner or operator of an underinsured motor vehicle, but shall be added to, combined with, or stacked
upon the liability coverage of the owner or operator of the underinsured motor vehicle to determine the limit
of coverage available to the injured person.
(f) (i) A named insured may reject underinsured motorist coverage by an express writing to the
insurer that provides liability coverage under Subsection 31A-22-302 (1)(a).
(ii) This written rejection shall be on a form provided by the insurer that includes a reasonable
explanation of the purpose of underinsured motorist coverage and when it would be applicable.
(iii) This rejection continues for that issuer of the liability coverage until the insured in writing
requests underinsured motorist coverage from that liability insurer.
(g) (i) In conjunction with the first two renewal notices sent after January 1, 2001, for policies

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existing on that date, the insurer shall disclose in the same medium as the premium renewal notice, an
explanation of the purpose of underinsured motorist coverage and the costs associated with increasing the
coverage in amounts up to and including the maximum amount available by the insurer under the insured's
motor vehicle policy.
(ii) The disclosure shall be sent to all insureds that carry underinsured motorist coverage limits in
an amount less than the insured's motor vehicle liability policy limits or the maximum underinsured motorist
coverage limits available by the insurer under the insured's motor vehicle policy.
(10) (a) Underinsured motorist coverage under this section applies to bodily injury, sickness,
disease, or death of an insured while occupying or using a motor vehicle owned by, furnished, or available
for the regular use of the insured, a resident spouse, or resident relative of the insured, only if the motor
vehicle is described in the policy under which a claim is made, or if the motor vehicle is a newly acquired
or replacement vehicle covered under the terms of the policy. Except as provided in this Subsection (10),
a covered person injured in a vehicle described in a policy that includes underinsured motorist benefits may
not elect to collect underinsured motorist coverage benefits from any other motor vehicle insurance policy
under which he is a named insured.
(b) (i) The limit of liability for underinsured motorist coverage for two or more motor vehicles may
not be added together, combined, or stacked to determine the limit of insurance coverage available to an
injured person for any one accident.
(ii) Subsection (10)(b)(i) applies to all persons except a covered person as defined under
Subsection (10)[(c)] (d)(i)(B).
(iii) Coverage on a motor vehicle occupied at the time of an accident shall be primary coverage,
and the coverage elected by a person described under Subsections (1)(a) and (b) shall be secondary
coverage.
(c) Underinsured motorist coverage:
(i) is secondary to the benefits provided by Title 34A, Chapter 2, Workers' Compensation Act;
(ii) may not be subrograted by the Workers' Compensation insurance carrier;

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(iii) may not be reduced by any benefits provided by Workers' Compensation insurance; and
(iv) may be reduced by health insurance subrogation only after the covered person has been made
whole.
(d) (i) Each of the following persons may also recover underinsured motorist coverage benefits
under any other policy in which they are described as a "covered person" as defined under Subsection (1):
(A) a covered person injured as a pedestrian by an underinsured motor vehicle; or
(B) a covered person injured while occupying or using a motor vehicle that is not owned by,
furnished, or available for the regular use of the covered person, the covered person's resident spouse, or
the covered person's resident relative.
(ii) This coverage shall only be available as a secondary source of coverage.
(iii) A covered person as defined under Subsection (10)[(b)](d)(i)(B) is entitled to the highest limits
of underinsured motorist coverage afforded for any one vehicle that the covered person is the named
insured or an insured family member.
(iv) This coverage shall be in addition to the coverage on the vehicle the covered person is
occupying.
(v) Neither the primary nor the secondary coverage may be set off against the other.
(e) A covered injured person is not barred against making subsequent elections if recovery is
unavailable under previous elections.
(11) A claim may not be brought by a covered person against a motor vehicle underinsured
motorist policy more than three years after the date of the last liability policy payment.
(12) (a) Within five business days after notification in a manner specified by the department that
all liability insurers have tendered their liability policy limits, the underinsured carrier shall either:
(i) waive any subrogation claim the underinsured carrier may have against the person liable for the
injuries caused in the accident; or
(ii) pay the insured an amount equal to the policy limits tendered by the liability carrier.
(b) If neither option is exercised under Subsection (12)(a), the subrogation claim is deemed to be

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waived by the underinsured carrier.
Section 2. Section 31A-22-307 is amended to read:
31A-22-307. Personal injury protection coverages and benefits.
(1) Personal injury protection coverages and benefits include:
(a) the reasonable value of all expenses for necessary medical, surgical, X-ray, dental,
rehabilitation, including prosthetic devices, ambulance, hospital, and nursing services, not to exceed a total
of $3,000 per person;
(b) (i) the lesser of $250 per week or 85% of any loss of gross income and loss of earning
capacity per person from inability to work, for a maximum of 52 consecutive weeks after the loss, except
that this benefit need not be paid for the first three days of disability, unless the disability continues for longer
than two consecutive weeks after the date of injury; and
(ii) a special damage allowance not exceeding $20 per day for a maximum of 365 days, for
services actually rendered or expenses reasonably incurred for services that, but for the injury, the injured
person would have performed for his household, except that this benefit need not be paid for the first three
days after the date of injury unless the person's inability to perform these services continues for more than
two consecutive weeks;
(c) funeral, burial, or cremation benefits not to exceed a total of $1,500 per person; and
(d) compensation on account of death of a person, payable to his heirs, in the total of $3,000.
(2) (a) To determine the reasonable value of the medical expenses provided for in Subsection (1)
and under Subsection 31A-22-309 (1)[(e)](a)(v), the commissioner shall conduct a relative value study
of services and accommodations for the diagnosis, care, recovery, or rehabilitation of an injured person
in the most populous county in the state to assign a unit value and determine the 75th percentile charge for
each type of service and accommodation. The study shall be updated every other year. In conducting the
study, the department may consult or contract with appropriate public and private medical and health
agencies or other technical experts. The costs and expenses incurred in conducting, maintaining, and
administering the relative value study shall be funded by the tax created under Section 59-9-105 . Upon

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completion of the study, the department shall prepare and publish a relative value study which sets forth
the unit value and the 75th percentile charge assigned to each type of service and accommodation.
(b) The reasonable value of any service or accommodation is determined by applying the unit value
and the 75th percentile charge assigned to the service or accommodation under the relative value study.
If a service or accommodation is not assigned a unit value or the 75th percentile charge under the relative
value study, the value of the service or accommodation shall equal the reasonable cost of the same or
similar service or accommodation in the most populous county of this state.
(c) This Subsection (2) does not preclude the department from adopting a schedule already
established or a schedule prepared by persons outside the department, if it meets the requirements of this
subsection.
(d) Every insurer shall report to the Commissioner of Insurance any patterns of overcharging,
excessive treatment, or other improper actions by a health provider within 30 days after such insurer has
knowledge of such pattern.
(e) In disputed cases, a court on its own motion or on the motion of either party may designate an
impartial medical panel of not more than three licensed physicians to examine the claimant and testify on
the issue of the reasonable value of the claimant's medical services or expenses.
(3) Medical expenses as provided for in Subsection (1)(a) and in Subsection 31A-22-309
(1)[(e)](a)(v) include expenses for any nonmedical remedial care and treatment rendered in accordance
with a recognized religious method of healing.
(4) The insured may waive for the named insured and the named insured's spouse only the loss
of gross income benefits of Subsection (1)(b)(i) if the insured states in writing that:
(a) within 31 days of applying for coverage, neither the insured nor the insured's spouse received
any earned income from regular employment; and
(b) for at least 180 days from the date of the writing and during the period of insurance, neither
the insured nor the insured's spouse will receive earned income from regular employment.
(5) This section does not prohibit the issuance of policies of insurance providing coverages greater

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than the minimum coverage required under this chapter nor does it require the segregation of those minimum
coverages from other coverages in the same policy.
(6) Deductibles are not permitted with respect to the insurance coverages required under this
section.
Section 3. Section 31A-22-309 is amended to read:
31A-22-309. Limitations, exclusions, and conditions to personal injury protection.
(1) (a) A person who has or is required to have direct benefit coverage under a policy which
includes personal injury protection may not maintain a cause of action for general damages arising out of
personal injuries alleged to have been caused by an automobile accident, except where the person has
sustained one or more of the following:
[(a)] (i) death;
[(b)] (ii) dismemberment;
[(c)] (iii) permanent disability or permanent impairment based upon objective findings;
[(d)] (iv) permanent disfigurement; or
[(e)] (v) medical expenses to a person in excess of $3,000.
(b) Subsection (1)(a) does not apply to a person making an uninsured motorist claim.
(2) (a) Any insurer issuing personal injury protection coverage under this part may only exclude
from this coverage benefits:
(i) for any injury sustained by the insured while occupying another motor vehicle owned by or
furnished for the regular use of the insured or a resident family member of the insured and not insured under
the policy;
(ii) for any injury sustained by any person while operating the insured motor vehicle without the
express or implied consent of the insured or while not in lawful possession of the insured motor vehicle;
(iii) to any injured person, if the person's conduct contributed to his injury:
(A) by intentionally causing injury to himself; or
(B) while committing a felony;

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(iv) for any injury sustained by any person arising out of the use of any motor vehicle while located
for use as a residence or premises;
(v) for any injury due to war, whether or not declared, civil war, insurrection, rebellion or
revolution, or to any act or condition incident to any of the foregoing; or
(vi) for any injury resulting from the radioactive, toxic, explosive, or other hazardous properties
of nuclear materials.
(b) The provisions of this subsection do not limit the exclusions which may be contained in other
types of coverage.
(3) The benefits payable to any injured person under Section 31A-22-307 are reduced by:
(a) any benefits which that person receives or is entitled to receive as a result of an accident
covered in this code under any workers' compensation or similar statutory plan; and
(b) any amounts which that person receives or is entitled to receive from the United States or any
of its agencies because that person is on active duty in the military service.
(4) When a person injured is also an insured party under any other policy, including those policies
complying with this part, primary coverage is given by the policy insuring the motor vehicle in use during
the accident.
(5) (a) Payment of the benefits provided for in Section 31A-22-307 shall be made on a monthly
basis as expenses are incurred.
(b) Benefits for any period are overdue if they are not paid within 30 days after the insurer receives
reasonable proof of the fact and amount of expenses incurred during the period. If reasonable proof is not
supplied as to the entire claim, the amount supported by reasonable proof is overdue if not paid within 30
days after that proof is received by the insurer. Any part or all of the remainder of the claim that is later
supported by reasonable proof is also overdue if not paid within 30 days after the proof is received by the
insurer.
(c) If the insurer fails to pay the expenses when due, these expenses shall bear interest at the rate
of 1-1/2% per month after the due date.

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(d) The person entitled to the benefits may bring an action in contract to recover the expenses plus
the applicable interest. If the insurer is required by the action to pay any overdue benefits and interest, the
insurer is also required to pay a reasonable attorney's fee to the claimant.
(6) Every policy providing personal injury protection coverage is subject to the following:
(a) that where the insured under the policy is or would be held legally liable for the personal injuries
sustained by any person to whom benefits required under personal injury protection have been paid by
another insurer, including the Workers' Compensation Fund created under Chapter 33, the insurer of the
person who would be held legally liable shall reimburse the other insurer for the payment, but not in excess
of the amount of damages recoverable; and
(b) that the issue of liability for that reimbursement and its amount shall be decided by mandatory,
binding arbitration between the insurers.

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