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S.B. 236

             1     

UNINSURED AND UNDERINSURED MOTORIST COVERAGE

             2     
AMENDMENTS

             3     
2013 GENERAL SESSION

             4     
STATE OF UTAH

             5     
Chief Sponsor: Lyle W. Hillyard

             6     
House Sponsor: Jack R. Draxler

             7     
             8      LONG TITLE
             9      General Description:
             10          This bill modifies the Insurance Code by amending provisions relating to uninsured and
             11      underinsured motorist coverage.
             12      Highlighted Provisions:
             13          This bill:
             14          .    amends the acknowledgment form requirements for a named insured to sign to
             15      reject the statutory minimum of uninsured or underinsured motorist coverage or
             16      purchase coverage in a lesser amount;
             17          .    makes the acknowledgment form requirement retroactive for any claim arising on or
             18      after January 1, 2001, for which, as of May 14, 2013, an insured has not made a
             19      written demand for arbitration or filed a complaint in a court of competent
             20      jurisdiction;
             21          .    provides that any selection or rejection of uninsured or underinsured motorist
             22      coverage continues for that issuer of the liability coverage until the insured requests,
             23      in writing, a change of uninsured or underinsured motorist coverage from that
             24      liability insurer;
             25          .    amends the Rules of Civil Procedure that an arbitration shall comply with when
             26      arbitrating a claim that is brought by a named insured or a covered person and is
             27      asserted against the covered person's uninsured or underinsured motorist carrier;


             28          .    requires a covered person to disclose all material information, other than rebuttal
             29      evidence, within 30 days after a covered person elects to submit a claim for
             30      uninsured or underinsured motorist coverage benefits to binding arbitration or files
             31      litigation; and
             32          .    makes technical corrections.
             33      Money Appropriated in this Bill:
             34          None
             35      Other Special Clauses:
             36          None
             37      Utah Code Sections Affected:
             38      AMENDS:
             39          31A-22-305, as last amended by Laws of Utah 2012, Chapter 283
             40          31A-22-305.3, as last amended by Laws of Utah 2012, Chapter 283
             41     
             42      Be it enacted by the Legislature of the state of Utah:
             43          Section 1. Section 31A-22-305 is amended to read:
             44           31A-22-305. Uninsured motorist coverage.
             45          (1) As used in this section, "covered persons" includes:
             46          (a) the named insured;
             47          (b) persons related to the named insured by blood, marriage, adoption, or guardianship,
             48      who are residents of the named insured's household, including those who usually make their
             49      home in the same household but temporarily live elsewhere;
             50          (c) any person occupying or using a motor vehicle:
             51          (i) referred to in the policy; or
             52          (ii) owned by a self-insured; and
             53          (d) any person who is entitled to recover damages against the owner or operator of the
             54      uninsured or underinsured motor vehicle because of bodily injury to or death of persons under
             55      Subsection (1)(a), (b), or (c).
             56          (2) As used in this section, "uninsured motor vehicle" includes:
             57          (a) (i) a motor vehicle, the operation, maintenance, or use of which is not covered
             58      under a liability policy at the time of an injury-causing occurrence; or


             59          (ii) (A) a motor vehicle covered with lower liability limits than required by Section
             60      31A-22-304 ; and
             61          (B) the motor vehicle described in Subsection (2)(a)(ii)(A) is uninsured to the extent of
             62      the deficiency;
             63          (b) an unidentified motor vehicle that left the scene of an accident proximately caused
             64      by the motor vehicle operator;
             65          (c) a motor vehicle covered by a liability policy, but coverage for an accident is
             66      disputed by the liability insurer for more than 60 days or continues to be disputed for more than
             67      60 days; or
             68          (d) (i) an insured motor vehicle if, before or after the accident, the liability insurer of
             69      the motor vehicle is declared insolvent by a court of competent jurisdiction; and
             70          (ii) the motor vehicle described in Subsection (2)(d)(i) is uninsured only to the extent
             71      that the claim against the insolvent insurer is not paid by a guaranty association or fund.
             72          (3) Uninsured motorist coverage under Subsection 31A-22-302 (1)(b) provides
             73      coverage for covered persons who are legally entitled to recover damages from owners or
             74      operators of uninsured motor vehicles because of bodily injury, sickness, disease, or death.
             75          (4) (a) For new policies written on or after January 1, 2001, the limits of uninsured
             76      motorist coverage shall be equal to the lesser of the limits of the named insured's motor vehicle
             77      liability coverage or the maximum uninsured motorist coverage limits available by the insurer
             78      under the named insured's motor vehicle policy, unless a named insured rejects or purchases
             79      coverage in a lesser amount by signing an acknowledgment form that:
             80          (i) is filed with the department;
             81          (ii) is provided by the insurer;
             82          (iii) waives the higher coverage;
             83          (iv) [reasonably explains the purpose of] need only state in this or similar language that
             84      uninsured motorist coverage provides benefits or protection to you and other covered persons
             85      for bodily injury resulting from an accident caused by the fault of another party where the other
             86      party has no liability insurance; and
             87          (v) discloses the premium required to purchase the statutory minimum uninsured
             88      motorist coverage and additional premiums required to purchase uninsured motorist coverage
             89      with limits equal to the lesser of the limits of the named insured's motor vehicle liability


             90      coverage or the maximum uninsured motorist coverage limits available by the insurer under the
             91      named insured's motor vehicle policy.
             92          (b) Any selection or rejection under this Subsection (4) continues for that issuer of the
             93      liability coverage until the insured requests, in writing, a change of uninsured motorist
             94      coverage from that liability insurer.
             95          (c) (i) Subsections (4)(a) and (b) apply retroactively to any claim arising on or after
             96      January 1, 2001, for which, as of May 14, 2013, an insured has not made a written demand for
             97      arbitration or filed a complaint in a court of competent jurisdiction.
             98          (ii) The Legislature finds that the retroactive application of Subsections (4)(a) and (b)
             99      clarifies legislative intent and does not enlarge, eliminate, or destroy vested rights.
             100          [(b)] (d) For purposes of this Subsection (4), "new policy" means:
             101          (i) any policy that is issued which does not include a renewal or reinstatement of an
             102      existing policy; or
             103          (ii) a change to an existing policy that results in:
             104          (A) a named insured being added to or deleted from the policy; or
             105          (B) a change in the limits of the named insured's motor vehicle liability coverage.
             106          [(c)] (e) (i) As used in this Subsection (4)[(c)](e), "additional motor vehicle" means a
             107      change that increases the total number of vehicles insured by the policy, and does not include
             108      replacement, substitute, or temporary vehicles.
             109          (ii) The adding of an additional motor vehicle to an existing personal lines or
             110      commercial lines policy does not constitute a new policy for purposes of Subsection
             111      (4)[(b)](d).
             112          (iii) If an additional motor vehicle is added to a personal lines policy where uninsured
             113      motorist coverage has been rejected, or where uninsured motorist limits are lower than the
             114      named insured's motor vehicle liability limits, the insurer shall provide a notice to a named
             115      insured within 30 days that:
             116          (A) [reasonably] in the same manner as described in Subsection (4)(a)(iv), explains the
             117      purpose of uninsured motorist coverage; and
             118          (B) encourages the named insured to contact the insurance company or insurance
             119      producer for quotes as to the additional premiums required to purchase uninsured motorist
             120      coverage with limits equal to the lesser of the limits of the named insured's motor vehicle


             121      liability coverage or the maximum uninsured motorist coverage limits available by the insurer
             122      under the named insured's motor vehicle policy.
             123          [(d)] (f) A change in policy number resulting from any policy change not identified
             124      under Subsection (4)[(b)](d)(ii) does not constitute a new policy.
             125          [(e)] (g) (i) Subsection (4)[(b)](d) applies retroactively to any claim arising on or after
             126      January 1, 2001, for which, as of May 1, 2012, an insured has not made a written demand for
             127      arbitration or filed a complaint in a court of competent jurisdiction.
             128          (ii) The Legislature finds that the retroactive application of Subsection (4):
             129          (A) does not enlarge, eliminate, or destroy vested rights; and
             130          (B) clarifies legislative intent.
             131          [(f)] (h) A self-insured, including a governmental entity, may elect to provide
             132      uninsured motorist coverage in an amount that is less than its maximum self-insured retention
             133      under Subsections (4)(a) and (5)(a) by issuing a declaratory memorandum or policy statement
             134      from the chief financial officer or chief risk officer that declares the:
             135          (i) self-insured entity's coverage level; and
             136          (ii) process for filing an uninsured motorist claim.
             137          [(g)] (i) Uninsured motorist coverage may not be sold with limits that are less than the
             138      minimum bodily injury limits for motor vehicle liability policies under Section 31A-22-304 .
             139          [(h)] (j) The acknowledgment under Subsection (4)(a) continues for that issuer of the
             140      uninsured motorist coverage until the named insured requests, in writing, different uninsured
             141      motorist coverage from the insurer.
             142          [(i)] (k) (i) In conjunction with the first two renewal notices sent after January 1, 2001,
             143      for policies existing on that date, the insurer shall disclose in the same medium as the premium
             144      renewal notice, an explanation of:
             145          (A) the purpose of uninsured motorist coverage in the same manner as described in
             146      Subsection (4)(a)(iv); and
             147          (B) a disclosure of the additional premiums required to purchase uninsured motorist
             148      coverage with limits equal to the lesser of the limits of the named insured's motor vehicle
             149      liability coverage or the maximum uninsured motorist coverage limits available by the insurer
             150      under the named insured's motor vehicle policy.
             151          (ii) The disclosure required under Subsection (4)[(i)](k)(i) shall be sent to all named


             152      insureds that carry uninsured motorist coverage limits in an amount less than the named
             153      insured's motor vehicle liability policy limits or the maximum uninsured motorist coverage
             154      limits available by the insurer under the named insured's motor vehicle policy.
             155          [(j)] (l) For purposes of this Subsection (4), a notice or disclosure sent to a named
             156      insured in a household constitutes notice or disclosure to all insureds within the household.
             157          (5) (a) (i) Except as provided in Subsection (5)(b), the named insured may reject
             158      uninsured motorist coverage by an express writing to the insurer that provides liability
             159      coverage under Subsection 31A-22-302 (1)(a).
             160          (ii) This rejection shall be on a form provided by the insurer that includes a reasonable
             161      explanation of the purpose of uninsured motorist coverage.
             162          (iii) This rejection continues for that issuer of the liability coverage until the insured in
             163      writing requests uninsured motorist coverage from that liability insurer.
             164          (b) (i) All persons, including governmental entities, that are engaged in the business of,
             165      or that accept payment for, transporting natural persons by motor vehicle, and all school
             166      districts that provide transportation services for their students, shall provide coverage for all
             167      motor vehicles used for that purpose, by purchase of a policy of insurance or by self-insurance,
             168      uninsured motorist coverage of at least $25,000 per person and $500,000 per accident.
             169          (ii) This coverage is secondary to any other insurance covering an injured covered
             170      person.
             171          (c) Uninsured motorist coverage:
             172          (i) is secondary to the benefits provided by Title 34A, Chapter 2, Workers'
             173      Compensation Act;
             174          (ii) may not be subrogated by the workers' compensation insurance carrier;
             175          (iii) may not be reduced by any benefits provided by workers' compensation insurance;
             176          (iv) may be reduced by health insurance subrogation only after the covered person has
             177      been made whole;
             178          (v) may not be collected for bodily injury or death sustained by a person:
             179          (A) while committing a violation of Section 41-1a-1314 ;
             180          (B) who, as a passenger in a vehicle, has knowledge that the vehicle is being operated
             181      in violation of Section 41-1a-1314 ; or
             182          (C) while committing a felony; and


             183          (vi) notwithstanding Subsection (5)(c)(v), may be recovered:
             184          (A) for a person under 18 years of age who is injured within the scope of Subsection
             185      (5)(c)(v) but limited to medical and funeral expenses; or
             186          (B) by a law enforcement officer as defined in Section 53-13-103 , who is injured
             187      within the course and scope of the law enforcement officer's duties.
             188          (d) As used in this Subsection (5), "motor vehicle" has the same meaning as under
             189      Section 41-1a-102 .
             190          (6) When a covered person alleges that an uninsured motor vehicle under Subsection
             191      (2)(b) proximately caused an accident without touching the covered person or the motor
             192      vehicle occupied by the covered person, the covered person shall show the existence of the
             193      uninsured motor vehicle by clear and convincing evidence consisting of more than the covered
             194      person's testimony.
             195          (7) (a) The limit of liability for uninsured motorist coverage for two or more motor
             196      vehicles may not be added together, combined, or stacked to determine the limit of insurance
             197      coverage available to an injured person for any one accident.
             198          (b) (i) Subsection (7)(a) applies to all persons except a covered person as defined under
             199      Subsection (8)(b)(ii).
             200          (ii) A covered person as defined under Subsection (8)(b)(ii) is entitled to the highest
             201      limits of uninsured motorist coverage afforded for any one motor vehicle that the covered
             202      person is the named insured or an insured family member.
             203          (iii) This coverage shall be in addition to the coverage on the motor vehicle the covered
             204      person is occupying.
             205          (iv) Neither the primary nor the secondary coverage may be set off against the other.
             206          (c) Coverage on a motor vehicle occupied at the time of an accident shall be primary
             207      coverage, and the coverage elected by a person described under Subsections (1)(a) and (b) shall
             208      be secondary coverage.
             209          (8) (a) Uninsured motorist coverage under this section applies to bodily injury,
             210      sickness, disease, or death of covered persons while occupying or using a motor vehicle only if
             211      the motor vehicle is described in the policy under which a claim is made, or if the motor
             212      vehicle is a newly acquired or replacement motor vehicle covered under the terms of the policy.
             213      Except as provided in Subsection (7) or this Subsection (8), a covered person injured in a


             214      motor vehicle described in a policy that includes uninsured motorist benefits may not elect to
             215      collect uninsured motorist coverage benefits from any other motor vehicle insurance policy
             216      under which the person is a covered person.
             217          (b) Each of the following persons may also recover uninsured motorist benefits under
             218      any one other policy in which they are described as a "covered person" as defined in Subsection
             219      (1):
             220          (i) a covered person injured as a pedestrian by an uninsured motor vehicle; and
             221          (ii) except as provided in Subsection (8)(c), a covered person injured while occupying
             222      or using a motor vehicle that is not owned, leased, or furnished:
             223          (A) to the covered person;
             224          (B) to the covered person's spouse; or
             225          (C) to the covered person's resident parent or resident sibling.
             226          (c) (i) A covered person may recover benefits from no more than two additional
             227      policies, one additional policy from each parent's household if the covered person is:
             228          (A) a dependent minor of parents who reside in separate households; and
             229          (B) injured while occupying or using a motor vehicle that is not owned, leased, or
             230      furnished:
             231          (I) to the covered person;
             232          (II) to the covered person's resident parent; or
             233          (III) to the covered person's resident sibling.
             234          (ii) Each parent's policy under this Subsection (8)(c) is liable only for the percentage of
             235      the damages that the limit of liability of each parent's policy of uninsured motorist coverage
             236      bears to the total of both parents' uninsured coverage applicable to the accident.
             237          (d) A covered person's recovery under any available policies may not exceed the full
             238      amount of damages.
             239          (e) A covered person in Subsection (8)(b) is not barred against making subsequent
             240      elections if recovery is unavailable under previous elections.
             241          (f) (i) As used in this section, "interpolicy stacking" means recovering benefits for a
             242      single incident of loss under more than one insurance policy.
             243          (ii) Except to the extent permitted by Subsection (7) and this Subsection (8),
             244      interpolicy stacking is prohibited for uninsured motorist coverage.


             245          (9) (a) When a claim is brought by a named insured or a person described in
             246      Subsection (1) and is asserted against the covered person's uninsured motorist carrier, the
             247      claimant may elect to resolve the claim:
             248          (i) by submitting the claim to binding arbitration; or
             249          (ii) through litigation.
             250          (b) Unless otherwise provided in the policy under which uninsured benefits are
             251      claimed, the election provided in Subsection (9)(a) is available to the claimant only.
             252          (c) Once the claimant has elected to commence litigation under Subsection (9)(a)(ii),
             253      the claimant may not elect to resolve the claim through binding arbitration under this section
             254      without the written consent of the uninsured motorist carrier.
             255          (d) (i) Unless otherwise agreed to in writing by the parties, a claim that is submitted to
             256      binding arbitration under Subsection (9)(a)(i) shall be resolved by a single arbitrator.
             257          (ii) All parties shall agree on the single arbitrator selected under Subsection (9)(d)(i).
             258          (iii) If the parties are unable to agree on a single arbitrator as required under Subsection
             259      (9)(d)(ii), the parties shall select a panel of three arbitrators.
             260          (e) If the parties select a panel of three arbitrators under Subsection (9)(d)(iii):
             261          (i) each side shall select one arbitrator; and
             262          (ii) the arbitrators appointed under Subsection (9)(e)(i) shall select one additional
             263      arbitrator to be included in the panel.
             264          (f) Unless otherwise agreed to in writing:
             265          (i) each party shall pay an equal share of the fees and costs of the arbitrator selected
             266      under Subsection (9)(d)(i); or
             267          (ii) if an arbitration panel is selected under Subsection (9)(d)(iii):
             268          (A) each party shall pay the fees and costs of the arbitrator selected by that party; and
             269          (B) each party shall pay an equal share of the fees and costs of the arbitrator selected
             270      under Subsection (9)(e)(ii).
             271          (g) Except as otherwise provided in this section or unless otherwise agreed to in
             272      writing by the parties, an arbitration proceeding conducted under this section shall be governed
             273      by Title 78B, Chapter 11, Utah Uniform Arbitration Act.
             274          (h) (i) The arbitration shall be conducted in accordance with Rules 26(a)(4) through (f),
             275      27 through 37, 54, and 68 of the Utah Rules of Civil Procedure, once the requirements of


             276      Subsections (10)(a) through (c) are satisfied.
             277          (ii) The specified tier as defined by Rule 26(c)(3) of the Utah Rules of Civil Procedure
             278      shall be determined based on the claimant's specific monetary amount in the written demand
             279      for payment of uninsured motorist coverage benefits as required in Subsection (10)(a)(i)(A).
             280          (iii) Rules 26.1 and 26.2 of the Utah Rules of Civil Procedure do not apply to claims
             281      under this part.
             282          (i) All issues of discovery shall be resolved by the arbitrator or the arbitration panel.
             283          (j) A written decision by a single arbitrator or by a majority of the arbitration panel
             284      shall constitute a final decision.
             285          (k) (i) Except as provided in Subsection (10), the amount of an arbitration award may
             286      not exceed the uninsured motorist policy limits of all applicable uninsured motorist policies,
             287      including applicable uninsured motorist umbrella policies.
             288          (ii) If the initial arbitration award exceeds the uninsured motorist policy limits of all
             289      applicable uninsured motorist policies, the arbitration award shall be reduced to an amount
             290      equal to the combined uninsured motorist policy limits of all applicable uninsured motorist
             291      policies.
             292          (l) The arbitrator or arbitration panel may not decide the issues of coverage or
             293      extra-contractual damages, including:
             294          (i) whether the claimant is a covered person;
             295          (ii) whether the policy extends coverage to the loss; or
             296          (iii) any allegations or claims asserting consequential damages or bad faith liability.
             297          (m) The arbitrator or arbitration panel may not conduct arbitration on a class-wide or
             298      class-representative basis.
             299          (n) If the arbitrator or arbitration panel finds that the action was not brought, pursued,
             300      or defended in good faith, the arbitrator or arbitration panel may award reasonable attorney fees
             301      and costs against the party that failed to bring, pursue, or defend the claim in good faith.
             302          (o) An arbitration award issued under this section shall be the final resolution of all
             303      claims not excluded by Subsection (9)(l) between the parties unless:
             304          (i) the award was procured by corruption, fraud, or other undue means;
             305          (ii) either party, within 20 days after service of the arbitration award:
             306          (A) files a complaint requesting a trial de novo in the district court; and


             307          (B) serves the nonmoving party with a copy of the complaint requesting a trial de novo
             308      under Subsection (9)(o)(ii)(A).
             309          (p) (i) Upon filing a complaint for a trial de novo under Subsection (9)(o), the claim
             310      shall proceed through litigation pursuant to the Utah Rules of Civil Procedure and Utah Rules
             311      of Evidence in the district court.
             312          (ii) In accordance with Rule 38, Utah Rules of Civil Procedure, either party may
             313      request a jury trial with a complaint requesting a trial de novo under Subsection (9)(o)(ii)(A).
             314          (q) (i) If the claimant, as the moving party in a trial de novo requested under
             315      Subsection (9)(o), does not obtain a verdict that is at least $5,000 and is at least 20% greater
             316      than the arbitration award, the claimant is responsible for all of the nonmoving party's costs.
             317          (ii) If the uninsured motorist carrier, as the moving party in a trial de novo requested
             318      under Subsection (9)(o), does not obtain a verdict that is at least 20% less than the arbitration
             319      award, the uninsured motorist carrier is responsible for all of the nonmoving party's costs.
             320          (iii) Except as provided in Subsection (9)(q)(iv), the costs under this Subsection (9)(q)
             321      shall include:
             322          (A) any costs set forth in Rule 54(d), Utah Rules of Civil Procedure; and
             323          (B) the costs of expert witnesses and depositions.
             324          (iv) An award of costs under this Subsection (9)(q) may not exceed $2,500 unless
             325      Subsection (10)(h)(iii) applies.
             326          (r) For purposes of determining whether a party's verdict is greater or less than the
             327      arbitration award under Subsection (9)(q), a court may not consider any recovery or other relief
             328      granted on a claim for damages if the claim for damages:
             329          (i) was not fully disclosed in writing prior to the arbitration proceeding; or
             330          (ii) was not disclosed in response to discovery contrary to the Utah Rules of Civil
             331      Procedure.
             332          (s) If a district court determines, upon a motion of the nonmoving party, that the
             333      moving party's use of the trial de novo process was filed in bad faith in accordance with
             334      Section 78B-5-825 , the district court may award reasonable attorney fees to the nonmoving
             335      party.
             336          (t) Nothing in this section is intended to limit any claim under any other portion of an
             337      applicable insurance policy.


             338          (u) If there are multiple uninsured motorist policies, as set forth in Subsection (8), the
             339      claimant may elect to arbitrate in one hearing the claims against all the uninsured motorist
             340      carriers.
             341          (10) (a) Within 30 days after a covered person elects to submit a claim for uninsured
             342      motorist benefits to binding arbitration or files litigation, the covered person shall provide to
             343      the uninsured motorist carrier:
             344          (i) a written demand for payment of uninsured motorist coverage benefits, setting forth:
             345          (A) the specific monetary amount of the demand; and
             346          (B) the factual and legal basis and any supporting documentation for the demand;
             347          (ii) a written statement under oath disclosing:
             348          (A) (I) the names and last known addresses of all health care providers who have
             349      rendered health care services to the covered person that are material to the claims for which
             350      uninsured motorist benefits are sought for a period of five years preceding the date of the event
             351      giving rise to the claim for uninsured motorist benefits up to the time the election for
             352      arbitration or litigation has been exercised; and
             353          (II) whether the covered person has seen other health care providers who have rendered
             354      health care services to the covered person, which the covered person claims are immaterial to
             355      the claims for which uninsured motorist benefits are sought, for a period of five years
             356      preceding the date of the event giving rise to the claim for uninsured motorist benefits up to the
             357      time the election for arbitration or litigation has been exercised that have not been disclosed
             358      under Subsection (10)(a)(ii)(A)(I);
             359          (B) (I) the names and last known addresses of all health insurers or other entities to
             360      whom the covered person has submitted claims for health care services or benefits material to
             361      the claims for which uninsured motorist benefits are sought, for a period of five years
             362      preceding the date of the event giving rise to the claim for uninsured motorist benefits up to the
             363      time the election for arbitration or litigation has been exercised; and
             364          (II) whether the identity of any health insurers or other entities to whom the covered
             365      person has submitted claims for health care services or benefits, which the covered person
             366      claims are immaterial to the claims for which uninsured motorist benefits are sought, for a
             367      period of five years preceding the date of the event giving rise to the claim for uninsured
             368      motorist benefits up to the time the election for arbitration or litigation have not been disclosed;


             369          (C) if lost wages, diminished earning capacity, or similar damages are claimed, all
             370      employers of the covered person for a period of five years preceding the date of the event
             371      giving rise to the claim for uninsured motorist benefits up to the time the election for
             372      arbitration or litigation has been exercised;
             373          (D) other documents to reasonably support the claims being asserted; and
             374          (E) all state and federal statutory lienholders including a statement as to whether the
             375      covered person is a recipient of Medicare or Medicaid benefits or Utah Children's Health
             376      Insurance Program benefits under Title 26, Chapter 40, Utah Children's Health Insurance Act,
             377      or if the claim is subject to any other state or federal statutory liens; and
             378          (iii) signed authorizations to allow the uninsured motorist carrier to only obtain records
             379      and billings from the individuals or entities disclosed.
             380          (b) (i) If the uninsured motorist carrier determines that the disclosure of undisclosed
             381      health care providers or health care insurers under Subsection (10)(a)(ii) is reasonably
             382      necessary, the uninsured motorist carrier may:
             383          (A) make a request for the disclosure of the identity of the health care providers or
             384      health care insurers; and
             385          (B) make a request for authorizations to allow the uninsured motorist carrier to only
             386      obtain records and billings from the individuals or entities not disclosed.
             387          (ii) If the covered person does not provide the requested information within 10 days:
             388          (A) the covered person shall disclose, in writing, the legal or factual basis for the
             389      failure to disclose the health care providers or health care insurers; and
             390          (B) either the covered person or the uninsured motorist carrier may request the
             391      arbitrator or arbitration panel to resolve the issue of whether the identities or records are to be
             392      provided if the covered person has elected arbitration.
             393          (iii) The time periods imposed by Subsection (10)(c)(i) are tolled pending resolution of
             394      the dispute concerning the disclosure and production of records of the health care providers or
             395      health care insurers.
             396          (c) (i) An uninsured motorist carrier that receives an election for arbitration or a notice
             397      of filing litigation and the demand for payment of uninsured motorist benefits under Subsection
             398      (10)(a)(i) shall have a reasonable time, not to exceed 60 days from the date of the demand and
             399      receipt of the items specified in Subsections (10)(a)(i) through (iii), to:


             400          (A) provide a written response to the written demand for payment provided for in
             401      Subsection (10)(a)(i);
             402          (B) except as provided in Subsection (10)(c)(i)(C), tender the amount, if any, of the
             403      uninsured motorist carrier's determination of the amount owed to the covered person; and
             404          (C) if the covered person is a recipient of Medicare or Medicaid benefits or Utah
             405      Children's Health Insurance Program benefits under Title 26, Chapter 40, Utah Children's
             406      Health Insurance Act, or if the claim is subject to any other state or federal statutory liens,
             407      tender the amount, if any, of the uninsured motorist carrier's determination of the amount owed
             408      to the covered person less:
             409          (I) if the amount of the state or federal statutory lien is established, the amount of the
             410      lien; or
             411          (II) if the amount of the state or federal statutory lien is not established, two times the
             412      amount of the medical expenses subject to the state or federal statutory lien until such time as
             413      the amount of the state or federal statutory lien is established.
             414          (ii) If the amount tendered by the uninsured motorist carrier under Subsection (10)(c)(i)
             415      is the total amount of the uninsured motorist policy limits, the tendered amount shall be
             416      accepted by the covered person.
             417          (d) A covered person who receives a written response from an uninsured motorist
             418      carrier as provided for in Subsection (10)(c)(i), may:
             419          (i) elect to accept the amount tendered in Subsection (10)(c)(i) as payment in full of all
             420      uninsured motorist claims; or
             421          (ii) elect to:
             422          (A) accept the amount tendered in Subsection (10)(c)(i) as partial payment of all
             423      uninsured motorist claims; and
             424          (B) litigate or arbitrate the remaining claim.
             425          (e) If a covered person elects to accept the amount tendered under Subsection (10)(c)(i)
             426      as partial payment of all uninsured motorist claims, the final award obtained through
             427      arbitration, litigation, or later settlement shall be reduced by any payment made by the
             428      uninsured motorist carrier under Subsection (10)(c)(i).
             429          (f) In an arbitration proceeding on the remaining uninsured claims:
             430          (i) the parties may not disclose to the arbitrator or arbitration panel the amount paid


             431      under Subsection (10)(c)(i) until after the arbitration award has been rendered; and
             432          (ii) the parties may not disclose the amount of the limits of uninsured motorist benefits
             433      provided by the policy.
             434          (g) If the final award obtained through arbitration or litigation is greater than the
             435      average of the covered person's initial written demand for payment provided for in Subsection
             436      (10)(a)(i) and the uninsured motorist carrier's initial written response provided for in
             437      Subsection (10)(c)(i), the uninsured motorist carrier shall pay:
             438          (i) the final award obtained through arbitration or litigation, except that if the award
             439      exceeds the policy limits of the subject uninsured motorist policy by more than $15,000, the
             440      amount shall be reduced to an amount equal to the policy limits plus $15,000; and
             441          (ii) any of the following applicable costs:
             442          (A) any costs as set forth in Rule 54(d), Utah Rules of Civil Procedure;
             443          (B) the arbitrator or arbitration panel's fee; and
             444          (C) the reasonable costs of expert witnesses and depositions used in the presentation of
             445      evidence during arbitration or litigation.
             446          (h) (i) The covered person shall provide an affidavit of costs within five days of an
             447      arbitration award.
             448          (ii) (A) Objection to the affidavit of costs shall specify with particularity the costs to
             449      which the uninsured motorist carrier objects.
             450          (B) The objection shall be resolved by the arbitrator or arbitration panel.
             451          (iii) The award of costs by the arbitrator or arbitration panel under Subsection
             452      (10)(g)(ii) may not exceed $5,000.
             453          (i) (i) A covered person shall disclose all material information, other than rebuttal
             454      evidence, within 30 days after a covered person elects to submit a claim for uninsured motorist
             455      coverage benefits to binding arbitration or files litigation as specified in Subsection (10)(a).
             456          (ii) If the information under Subsection (10)(i)(i) is not disclosed, the covered person
             457      may not recover costs or any amounts in excess of the policy under Subsection (10)(g).
             458          (j) This Subsection (10) does not limit any other cause of action that arose or may arise
             459      against the uninsured motorist carrier from the same dispute.
             460          (k) The provisions of this Subsection (10) only apply to motor vehicle accidents that
             461      occur on or after March 30, 2010.


             462          Section 2. Section 31A-22-305.3 is amended to read:
             463           31A-22-305.3. Underinsured motorist coverage.
             464          (1) As used in this section:
             465          (a) "Covered person" has the same meaning as defined in Section 31A-22-305 .
             466          (b) (i) "Underinsured motor vehicle" includes a motor vehicle, the operation,
             467      maintenance, or use of which is covered under a liability policy at the time of an injury-causing
             468      occurrence, but which has insufficient liability coverage to compensate fully the injured party
             469      for all special and general damages.
             470          (ii) The term "underinsured motor vehicle" does not include:
             471          (A) a motor vehicle that is covered under the liability coverage of the same policy that
             472      also contains the underinsured motorist coverage;
             473          (B) an uninsured motor vehicle as defined in Subsection 31A-22-305 (2); or
             474          (C) a motor vehicle owned or leased by:
             475          (I) a named insured;
             476          (II) a named insured's spouse; or
             477          (III) a dependent of a named insured.
             478          (2) (a) Underinsured motorist coverage under Subsection 31A-22-302 (1)(c) provides
             479      coverage for a covered person who is legally entitled to recover damages from an owner or
             480      operator of an underinsured motor vehicle because of bodily injury, sickness, disease, or death.
             481          (b) A covered person occupying or using a motor vehicle owned, leased, or furnished
             482      to the covered person, the covered person's spouse, or covered person's resident relative may
             483      recover underinsured benefits only if the motor vehicle is:
             484          (i) described in the policy under which a claim is made; or
             485          (ii) a newly acquired or replacement motor vehicle covered under the terms of the
             486      policy.
             487          (3) (a) For new policies written on or after January 1, 2001, the limits of underinsured
             488      motorist coverage shall be equal to the lesser of the limits of the named insured's motor vehicle
             489      liability coverage or the maximum underinsured motorist coverage limits available by the
             490      insurer under the named insured's motor vehicle policy, unless a named insured rejects or
             491      purchases coverage in a lesser amount by signing an acknowledgment form that:
             492          (i) is filed with the department;


             493          (ii) is provided by the insurer;
             494          (iii) waives the higher coverage;
             495          (iv) [reasonably explains the purpose of] need only state in this or similar language that
             496      underinsured motorist coverage provides benefits or protection to you and other covered
             497      persons for bodily injury resulting from an accident caused by the fault of another party where
             498      the other party has insufficient liability insurance; and
             499          (v) discloses the premium required to purchase the statutory minimum underinsured
             500      motorist coverage and additional premiums required to purchase underinsured motorist
             501      coverage with limits equal to the lesser of the limits of the named insured's motor vehicle
             502      liability coverage or the maximum underinsured motorist coverage limits available by the
             503      insurer under the named insured's motor vehicle policy.
             504          (b) Any selection or rejection under Subsection (3)(a) continues for that issuer of the
             505      liability coverage until the insured requests, in writing, a change of underinsured motorist
             506      coverage from that liability insurer.
             507          (c) (i) Subsections (3)(a) and (b) apply retroactively to any claim arising on or after
             508      January 1, 2001, for which, as of May 14, 2013, an insured has not made a written demand for
             509      arbitration or filed a complaint in a court of competent jurisdiction.
             510          (ii) The Legislature finds that the retroactive application of Subsections (3)(a) and (b)
             511      clarifies legislative intent and does not enlarge, eliminate, or destroy vested rights.
             512          [(b)] (d) For purposes of this Subsection (3), "new policy" means:
             513          (i) any policy that is issued which does not include a renewal or reinstatement of an
             514      existing policy; or
             515          (ii) a change to an existing policy that results in:
             516          (A) a named insured being added to or deleted from the policy; or
             517          (B) a change in the limits of the named insured's motor vehicle liability coverage.
             518          [(c)] (e) (i) As used in this Subsection (3)[(c)](e), "additional motor vehicle" means a
             519      change that increases the total number of vehicles insured by the policy, and does not include
             520      replacement, substitute, or temporary vehicles.
             521          (ii) The adding of an additional motor vehicle to an existing personal lines or
             522      commercial lines policy does not constitute a new policy for purposes of Subsection
             523      (3)[(b)](d).


             524          (iii) If an additional motor vehicle is added to a personal lines policy where
             525      underinsured motorist coverage has been rejected, or where underinsured motorist limits are
             526      lower than the named insured's motor vehicle liability limits, the insurer shall provide a notice
             527      to a named insured within 30 days that:
             528          (A) [reasonably] in the same manner described in Subsection (3)(a)(iv), explains the
             529      purpose of underinsured motorist coverage; and
             530          (B) encourages the named insured to contact the insurance company or insurance
             531      producer for quotes as to the additional premiums required to purchase underinsured motorist
             532      coverage with limits equal to the lesser of the limits of the named insured's motor vehicle
             533      liability coverage or the maximum underinsured motorist coverage limits available by the
             534      insurer under the named insured's motor vehicle policy.
             535          [(d)] (f) A change in policy number resulting from any policy change not identified
             536      under Subsection (3)[(b)](d)(ii) does not constitute a new policy.
             537          [(e)] (g) (i) Subsection (3)[(b)](d) applies retroactively to any claim arising on or after
             538      January 1, 2001 for which, as of May 1, 2012, an insured has not made a written demand for
             539      arbitration or filed a complaint in a court of competent jurisdiction.
             540          (ii) The Legislature finds that the retroactive application of Subsection (3)(d):
             541          (A) does not enlarge, eliminate, or destroy vested rights; and
             542          (B) clarifies legislative intent.
             543          [(f)] (h) A self-insured, including a governmental entity, may elect to provide
             544      underinsured motorist coverage in an amount that is less than its maximum self-insured
             545      retention under Subsections (3)(a) and [(3)(j)](l) by issuing a declaratory memorandum or
             546      policy statement from the chief financial officer or chief risk officer that declares the:
             547          (i) self-insured entity's coverage level; and
             548          (ii) process for filing an underinsured motorist claim.
             549          [(g)] (i) Underinsured motorist coverage may not be sold with limits that are less than:
             550          (i) $10,000 for one person in any one accident; and
             551          (ii) at least $20,000 for two or more persons in any one accident.
             552          [(h)] (j) An acknowledgment under Subsection (3)(a) continues for that issuer of the
             553      underinsured motorist coverage until the named insured, in writing, requests different
             554      underinsured motorist coverage from the insurer.


             555          [(i)] (k) (i) The named insured's underinsured motorist coverage, as described in
             556      Subsection (2), is secondary to the liability coverage of an owner or operator of an
             557      underinsured motor vehicle, as described in Subsection (1).
             558          (ii) Underinsured motorist coverage may not be set off against the liability coverage of
             559      the owner or operator of an underinsured motor vehicle, but shall be added to, combined with,
             560      or stacked upon the liability coverage of the owner or operator of the underinsured motor
             561      vehicle to determine the limit of coverage available to the injured person.
             562          [(j)] (l) (i) In conjunction with the first two renewal notices sent after January 1, 2001,
             563      for policies existing on that date, the insurer shall disclose in the same medium as the premium
             564      renewal notice, an explanation of:
             565          (A) the purpose of underinsured motorist coverage in the same manner as described in
             566      Subsection (3)(a)(iv); and
             567          (B) a disclosure of the additional premiums required to purchase underinsured motorist
             568      coverage with limits equal to the lesser of the limits of the named insured's motor vehicle
             569      liability coverage or the maximum underinsured motorist coverage limits available by the
             570      insurer under the named insured's motor vehicle policy.
             571          (ii) The disclosure required under this Subsection (3)[(j)](l) shall be sent to all named
             572      insureds that carry underinsured motorist coverage limits in an amount less than the named
             573      insured's motor vehicle liability policy limits or the maximum underinsured motorist coverage
             574      limits available by the insurer under the named insured's motor vehicle policy.
             575          [(k)] (m) For purposes of this Subsection (3), a notice or disclosure sent to a named
             576      insured in a household constitutes notice or disclosure to all insureds within the household.
             577          (4) (a) (i) Except as provided in this Subsection (4), a covered person injured in a
             578      motor vehicle described in a policy that includes underinsured motorist benefits may not elect
             579      to collect underinsured motorist coverage benefits from another motor vehicle insurance policy.
             580          (ii) The limit of liability for underinsured motorist coverage for two or more motor
             581      vehicles may not be added together, combined, or stacked to determine the limit of insurance
             582      coverage available to an injured person for any one accident.
             583          (iii) Subsection (4)(a)(ii) applies to all persons except a covered person described
             584      under Subsections (4)(b)(i) and (ii).
             585          (b) (i) Except as provided in Subsection (4)(b)(ii), a covered person injured while


             586      occupying, using, or maintaining a motor vehicle that is not owned, leased, or furnished to the
             587      covered person, the covered person's spouse, or the covered person's resident parent or resident
             588      sibling, may also recover benefits under any one other policy under which the covered person is
             589      also a covered person.
             590          (ii) (A) A covered person may recover benefits from no more than two additional
             591      policies, one additional policy from each parent's household if the covered person is:
             592          (I) a dependent minor of parents who reside in separate households; and
             593          (II) injured while occupying or using a motor vehicle that is not owned, leased, or
             594      furnished to the covered person, the covered person's resident parent, or the covered person's
             595      resident sibling.
             596          (B) Each parent's policy under this Subsection (4)(b)(ii) is liable only for the
             597      percentage of the damages that the limit of liability of each parent's policy of underinsured
             598      motorist coverage bears to the total of both parents' underinsured coverage applicable to the
             599      accident.
             600          (iii) A covered person's recovery under any available policies may not exceed the full
             601      amount of damages.
             602          (iv) Underinsured coverage on a motor vehicle occupied at the time of an accident is
             603      primary coverage, and the coverage elected by a person described under Subsections
             604      31A-22-305 (1)(a) and (b) is secondary coverage.
             605          (v) The primary and the secondary coverage may not be set off against the other.
             606          (vi) A covered person as described under Subsection (4)(b)(i) is entitled to the highest
             607      limits of underinsured motorist coverage under only one additional policy per household
             608      applicable to that covered person as a named insured, spouse, or relative.
             609          (vii) A covered injured person is not barred against making subsequent elections if
             610      recovery is unavailable under previous elections.
             611          (viii) (A) As used in this section, "interpolicy stacking" means recovering benefits for a
             612      single incident of loss under more than one insurance policy.
             613          (B) Except to the extent permitted by this Subsection (4), interpolicy stacking is
             614      prohibited for underinsured motorist coverage.
             615          (c) Underinsured motorist coverage:
             616          (i) is secondary to the benefits provided by Title 34A, Chapter 2, Workers'


             617      Compensation Act;
             618          (ii) may not be subrogated by a workers' compensation insurance carrier;
             619          (iii) may not be reduced by benefits provided by workers' compensation insurance;
             620          (iv) may be reduced by health insurance subrogation only after the covered person is
             621      made whole;
             622          (v) may not be collected for bodily injury or death sustained by a person:
             623          (A) while committing a violation of Section 41-1a-1314 ;
             624          (B) who, as a passenger in a vehicle, has knowledge that the vehicle is being operated
             625      in violation of Section 41-1a-1314 ; or
             626          (C) while committing a felony; and
             627          (vi) notwithstanding Subsection (4)(c)(v), may be recovered:
             628          (A) for a person under 18 years of age who is injured within the scope of Subsection
             629      (4)(c)(v), but is limited to medical and funeral expenses; or
             630          (B) by a law enforcement officer as defined in Section 53-13-103 , who is injured
             631      within the course and scope of the law enforcement officer's duties.
             632          (5) The inception of the loss under Subsection 31A-21-313 (1) for underinsured
             633      motorist claims occurs upon the date of the last liability policy payment.
             634          (6) (a) Within five business days after notification that all liability insurers have
             635      tendered their liability policy limits, the underinsured carrier shall either:
             636          (i) waive any subrogation claim the underinsured carrier may have against the person
             637      liable for the injuries caused in the accident; or
             638          (ii) pay the insured an amount equal to the policy limits tendered by the liability carrier.
             639          (b) If neither option is exercised under Subsection (6)(a), the subrogation claim is
             640      considered to be waived by the underinsured carrier.
             641          (7) Except as otherwise provided in this section, a covered person may seek, subject to
             642      the terms and conditions of the policy, additional coverage under any policy:
             643          (a) that provides coverage for damages resulting from motor vehicle accidents; and
             644          (b) that is not required to conform to Section 31A-22-302 .
             645          (8) (a) When a claim is brought by a named insured or a person described in
             646      Subsection 31A-22-305 (1) and is asserted against the covered person's underinsured motorist
             647      carrier, the claimant may elect to resolve the claim:


             648          (i) by submitting the claim to binding arbitration; or
             649          (ii) through litigation.
             650          (b) Unless otherwise provided in the policy under which underinsured benefits are
             651      claimed, the election provided in Subsection (8)(a) is available to the claimant only.
             652          (c) Once a claimant elects to commence litigation under Subsection (8)(a)(ii), the
             653      claimant may not elect to resolve the claim through binding arbitration under this section
             654      without the written consent of the underinsured motorist coverage carrier.
             655          (d) (i) Unless otherwise agreed to in writing by the parties, a claim that is submitted to
             656      binding arbitration under Subsection (8)(a)(i) shall be resolved by a single arbitrator.
             657          (ii) All parties shall agree on the single arbitrator selected under Subsection (8)(d)(i).
             658          (iii) If the parties are unable to agree on a single arbitrator as required under Subsection
             659      (8)(d)(ii), the parties shall select a panel of three arbitrators.
             660          (e) If the parties select a panel of three arbitrators under Subsection (8)(d)(iii):
             661          (i) each side shall select one arbitrator; and
             662          (ii) the arbitrators appointed under Subsection (8)(e)(i) shall select one additional
             663      arbitrator to be included in the panel.
             664          (f) Unless otherwise agreed to in writing:
             665          (i) each party shall pay an equal share of the fees and costs of the arbitrator selected
             666      under Subsection (8)(d)(i); or
             667          (ii) if an arbitration panel is selected under Subsection (8)(d)(iii):
             668          (A) each party shall pay the fees and costs of the arbitrator selected by that party; and
             669          (B) each party shall pay an equal share of the fees and costs of the arbitrator selected
             670      under Subsection (8)(e)(ii).
             671          (g) Except as otherwise provided in this section or unless otherwise agreed to in
             672      writing by the parties, an arbitration proceeding conducted under this section is governed by
             673      Title 78B, Chapter 11, Utah Uniform Arbitration Act.
             674          (h) (i) [An] The arbitration shall be conducted in accordance with Rules 26(a)(4)
             675      through (f), 27 through 37, 54, and 68 of the Utah Rules of Civil Procedure, once the
             676      requirements of Subsections (9)(a) through (c) are satisfied.
             677          (ii) The specified tier as defined by Rule 26(c)(3) of the Utah Rules of Civil Procedure
             678      shall be determined based on the claimant's specific monetary amount in the written demand


             679      for payment of uninsured motorist coverage benefits as required in Subsection (9)(a)(i)(A).
             680          (iii) Rules 26.1 and 26.2 of the Utah Rules of Civil Procedure do not apply to claims
             681      under this part.
             682          (i) An issue of discovery shall be resolved by the arbitrator or the arbitration panel.
             683          (j) A written decision by a single arbitrator or by a majority of the arbitration panel
             684      constitutes a final decision.
             685          (k) (i) Except as provided in Subsection (9), the amount of an arbitration award may
             686      not exceed the underinsured motorist policy limits of all applicable underinsured motorist
             687      policies, including applicable underinsured motorist umbrella policies.
             688          (ii) If the initial arbitration award exceeds the underinsured motorist policy limits of all
             689      applicable underinsured motorist policies, the arbitration award shall be reduced to an amount
             690      equal to the combined underinsured motorist policy limits of all applicable underinsured
             691      motorist policies.
             692          (l) The arbitrator or arbitration panel may not decide an issue of coverage or
             693      extra-contractual damages, including:
             694          (i) whether the claimant is a covered person;
             695          (ii) whether the policy extends coverage to the loss; or
             696          (iii) an allegation or claim asserting consequential damages or bad faith liability.
             697          (m) The arbitrator or arbitration panel may not conduct arbitration on a class-wide or
             698      class-representative basis.
             699          (n) If the arbitrator or arbitration panel finds that the arbitration is not brought, pursued,
             700      or defended in good faith, the arbitrator or arbitration panel may award reasonable attorney fees
             701      and costs against the party that failed to bring, pursue, or defend the arbitration in good faith.
             702          (o) An arbitration award issued under this section shall be the final resolution of all
             703      claims not excluded by Subsection (8)(l) between the parties unless:
             704          (i) the award is procured by corruption, fraud, or other undue means;
             705          (ii) either party, within 20 days after service of the arbitration award:
             706          (A) files a complaint requesting a trial de novo in the district court; and
             707          (B) serves the nonmoving party with a copy of the complaint requesting a trial de novo
             708      under Subsection (8)(o)(ii)(A).
             709          (p) (i) Upon filing a complaint for a trial de novo under Subsection (8)(o), a claim shall


             710      proceed through litigation pursuant to the Utah Rules of Civil Procedure and Utah Rules of
             711      Evidence in the district court.
             712          (ii) In accordance with Rule 38, Utah Rules of Civil Procedure, either party may
             713      request a jury trial with a complaint requesting a trial de novo under Subsection (8)(o)(ii)(A).
             714          (q) (i) If the claimant, as the moving party in a trial de novo requested under
             715      Subsection (8)(o), does not obtain a verdict that is at least $5,000 and is at least 20% greater
             716      than the arbitration award, the claimant is responsible for all of the nonmoving party's costs.
             717          (ii) If the underinsured motorist carrier, as the moving party in a trial de novo requested
             718      under Subsection (8)(o), does not obtain a verdict that is at least 20% less than the arbitration
             719      award, the underinsured motorist carrier is responsible for all of the nonmoving party's costs.
             720          (iii) Except as provided in Subsection (8)(q)(iv), the costs under this Subsection (8)(q)
             721      shall include:
             722          (A) any costs set forth in Rule 54(d), Utah Rules of Civil Procedure; and
             723          (B) the costs of expert witnesses and depositions.
             724          (iv) An award of costs under this Subsection (8)(q) may not exceed $2,500 unless
             725      Subsection (9)(h)(iii) applies.
             726          (r) For purposes of determining whether a party's verdict is greater or less than the
             727      arbitration award under Subsection (8)(q), a court may not consider any recovery or other relief
             728      granted on a claim for damages if the claim for damages:
             729          (i) was not fully disclosed in writing prior to the arbitration proceeding; or
             730          (ii) was not disclosed in response to discovery contrary to the Utah Rules of Civil
             731      Procedure.
             732          (s) If a district court determines, upon a motion of the nonmoving party, that a moving
             733      party's use of the trial de novo process is filed in bad faith in accordance with Section
             734      78B-5-825 , the district court may award reasonable attorney fees to the nonmoving party.
             735          (t) Nothing in this section is intended to limit a claim under another portion of an
             736      applicable insurance policy.
             737          (u) If there are multiple underinsured motorist policies, as set forth in Subsection (4),
             738      the claimant may elect to arbitrate in one hearing the claims against all the underinsured
             739      motorist carriers.
             740          (9) (a) Within 30 days after a covered person elects to submit a claim for underinsured


             741      motorist benefits to binding arbitration or files litigation, the covered person shall provide to
             742      the underinsured motorist carrier:
             743          (i) a written demand for payment of underinsured motorist coverage benefits, setting
             744      forth:
             745          (A) the specific monetary amount of the demand; and
             746          (B) the factual and legal basis and any supporting documentation for the demand;
             747          (ii) a written statement under oath disclosing:
             748          (A) (I) the names and last known addresses of all health care providers who have
             749      rendered health care services to the covered person that are material to the claims for which the
             750      underinsured motorist benefits are sought for a period of five years preceding the date of the
             751      event giving rise to the claim for underinsured motorist benefits up to the time the election for
             752      arbitration or litigation has been exercised; and
             753          (II) whether the covered person has seen other health care providers who have rendered
             754      health care services to the covered person, which the covered person claims are immaterial to
             755      the claims for which underinsured motorist benefits are sought, for a period of five years
             756      preceding the date of the event giving rise to the claim for underinsured motorist benefits up to
             757      the time the election for arbitration or litigation has been exercised that have not been disclosed
             758      under Subsection (9)(a)(ii)(A)(I);
             759          (B) (I) the names and last known addresses of all health insurers or other entities to
             760      whom the covered person has submitted claims for health care services or benefits material to
             761      the claims for which underinsured motorist benefits are sought, for a period of five years
             762      preceding the date of the event giving rise to the claim for underinsured motorist benefits up to
             763      the time the election for arbitration or litigation has been exercised; and
             764          (II) whether the identity of any health insurers or other entities to whom the covered
             765      person has submitted claims for health care services or benefits, which the covered person
             766      claims are immaterial to the claims for which underinsured motorist benefits are sought, for a
             767      period of five years preceding the date of the event giving rise to the claim for underinsured
             768      motorist benefits up to the time the election for arbitration or litigation have not been disclosed;
             769          (C) if lost wages, diminished earning capacity, or similar damages are claimed, all
             770      employers of the covered person for a period of five years preceding the date of the event
             771      giving rise to the claim for underinsured motorist benefits up to the time the election for


             772      arbitration or litigation has been exercised;
             773          (D) other documents to reasonably support the claims being asserted; and
             774          (E) all state and federal statutory lienholders including a statement as to whether the
             775      covered person is a recipient of Medicare or Medicaid benefits or Utah Children's Health
             776      Insurance Program benefits under Title 26, Chapter 40, Utah Children's Health Insurance Act,
             777      or if the claim is subject to any other state or federal statutory liens; and
             778          (iii) signed authorizations to allow the underinsured motorist carrier to only obtain
             779      records and billings from the individuals or entities disclosed.
             780          (b) (i) If the underinsured motorist carrier determines that the disclosure of undisclosed
             781      health care providers or health care insurers under Subsection (9)(a)(ii) is reasonably necessary,
             782      the underinsured motorist carrier may:
             783          (A) make a request for the disclosure of the identity of the health care providers or
             784      health care insurers; and
             785          (B) make a request for authorizations to allow the underinsured motorist carrier to only
             786      obtain records and billings from the individuals or entities not disclosed.
             787          (ii) If the covered person does not provide the requested information within 10 days:
             788          (A) the covered person shall disclose, in writing, the legal or factual basis for the
             789      failure to disclose the health care providers or health care insurers; and
             790          (B) either the covered person or the underinsured motorist carrier may request the
             791      arbitrator or arbitration panel to resolve the issue of whether the identities or records are to be
             792      provided if the covered person has elected arbitration.
             793          (iii) The time periods imposed by Subsection (9)(c)(i) are tolled pending resolution of
             794      the dispute concerning the disclosure and production of records of the health care providers or
             795      health care insurers.
             796          (c) (i) An underinsured motorist carrier that receives an election for arbitration or a
             797      notice of filing litigation and the demand for payment of underinsured motorist benefits under
             798      Subsection (9)(a)(i) shall have a reasonable time, not to exceed 60 days from the date of the
             799      demand and receipt of the items specified in Subsections (9)(a)(i) through (iii), to:
             800          (A) provide a written response to the written demand for payment provided for in
             801      Subsection (9)(a)(i);
             802          (B) except as provided in Subsection (9)(c)(i)(C), tender the amount, if any, of the


             803      underinsured motorist carrier's determination of the amount owed to the covered person; and
             804          (C) if the covered person is a recipient of Medicare or Medicaid benefits or Utah
             805      Children's Health Insurance Program benefits under Title 26, Chapter 40, Utah Children's
             806      Health Insurance Act, or if the claim is subject to any other state or federal statutory liens,
             807      tender the amount, if any, of the underinsured motorist carrier's determination of the amount
             808      owed to the covered person less:
             809          (I) if the amount of the state or federal statutory lien is established, the amount of the
             810      lien; or
             811          (II) if the amount of the state or federal statutory lien is not established, two times the
             812      amount of the medical expenses subject to the state or federal statutory lien until such time as
             813      the amount of the state or federal statutory lien is established.
             814          (ii) If the amount tendered by the underinsured motorist carrier under Subsection
             815      (9)(c)(i) is the total amount of the underinsured motorist policy limits, the tendered amount
             816      shall be accepted by the covered person.
             817          (d) A covered person who receives a written response from an underinsured motorist
             818      carrier as provided for in Subsection (9)(c)(i), may:
             819          (i) elect to accept the amount tendered in Subsection (9)(c)(i) as payment in full of all
             820      underinsured motorist claims; or
             821          (ii) elect to:
             822          (A) accept the amount tendered in Subsection (9)(c)(i) as partial payment of all
             823      underinsured motorist claims; and
             824          (B) litigate or arbitrate the remaining claim.
             825          (e) If a covered person elects to accept the amount tendered under Subsection (9)(c)(i)
             826      as partial payment of all underinsured motorist claims, the final award obtained through
             827      arbitration, litigation, or later settlement shall be reduced by any payment made by the
             828      underinsured motorist carrier under Subsection (9)(c)(i).
             829          (f) In an arbitration proceeding on the remaining underinsured claims:
             830          (i) the parties may not disclose to the arbitrator or arbitration panel the amount paid
             831      under Subsection (9)(c)(i) until after the arbitration award has been rendered; and
             832          (ii) the parties may not disclose the amount of the limits of underinsured motorist
             833      benefits provided by the policy.


             834          (g) If the final award obtained through arbitration or litigation is greater than the
             835      average of the covered person's initial written demand for payment provided for in Subsection
             836      (9)(a)(i) and the underinsured motorist carrier's initial written response provided for in
             837      Subsection (9)(c)(i), the underinsured motorist carrier shall pay:
             838          (i) the final award obtained through arbitration or litigation, except that if the award
             839      exceeds the policy limits of the subject underinsured motorist policy by more than $15,000, the
             840      amount shall be reduced to an amount equal to the policy limits plus $15,000; and
             841          (ii) any of the following applicable costs:
             842          (A) any costs as set forth in Rule 54(d), Utah Rules of Civil Procedure;
             843          (B) the arbitrator or arbitration panel's fee; and
             844          (C) the reasonable costs of expert witnesses and depositions used in the presentation of
             845      evidence during arbitration or litigation.
             846          (h) (i) The covered person shall provide an affidavit of costs within five days of an
             847      arbitration award.
             848          (ii) (A) Objection to the affidavit of costs shall specify with particularity the costs to
             849      which the underinsured motorist carrier objects.
             850          (B) The objection shall be resolved by the arbitrator or arbitration panel.
             851          (iii) The award of costs by the arbitrator or arbitration panel under Subsection (9)(g)(ii)
             852      may not exceed $5,000.
             853          (i) (i) A covered person shall disclose all material information, other than rebuttal
             854      evidence, within 30 days after a covered person elects to submit a claim for underinsured
             855      motorist coverage benefits to binding arbitration or files litigation as specified in Subsection
             856      (9)(a).
             857          (ii) If the information under Subsection (9)(i)(i) is not disclosed, the covered person
             858      may not recover costs or any amounts in excess of the policy under Subsection (9)(g).
             859          (j) This Subsection (9) does not limit any other cause of action that arose or may arise
             860      against the underinsured motorist carrier from the same dispute.
             861          (k) The provisions of this Subsection (9) only apply to motor vehicle accidents that
             862      occur on or after March 30, 2010.





Legislative Review Note
    as of 2-25-13 10:35 AM


Office of Legislative Research and General Counsel


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