2
3
4
5
6
7 LONG TITLE
8 General Description:
9 This bill amends provisions related to insurance claims.
10 Highlighted Provisions:
11 This bill:
12 ▸ prohibits a person engaged in the business of insurance from unreasonably delaying
13 or unreasonably denying payment of insurance claims;
14 ▸ provides that in an action to recover a claim on certain insurance, an insured is
15 entitled to:
16 • reasonable attorney's fees; and
17 • double the amount of the claim, if the court finds the insurer unreasonably
18 delayed or unreasonably denied a claim; and
19 ▸ defines terms.
20 Money Appropriated in this Bill:
21 None
22 Other Special Clauses:
23 None
24 Utah Code Sections Affected:
25 ENACTS:
26 31A-26-314, Utah Code Annotated 1953
27
28 Be it enacted by the Legislature of the state of Utah:
29 Section 1. Section 31A-26-314 is enacted to read:
30 31A-26-314. Improper denial of claims prohibited -- Remedies.
31 (1) As used in this section:
32 (a) (i) "First party claimant" means a person who asserts an entitlement to benefits
33 owed directly to or on behalf of an insured under an insurance policy.
34 (ii) "First party claimant" does not include:
35 (A) a nonparticipating provider performing services; or
36 (B) a person asserting a claim against an insured under a liability policy.
37 (b) "Unreasonable delay" means failure to comply with:
38 (i) Section 31A-26-301; and
39 (ii) rules the commissioner makes in accordance with Section 31A-26-301.
40 (c) "Unreasonable denial" means a denial of a claim:
41 (i) that is the result of, or in conjunction with, a violation of Section 31A-26-303; or
42 (ii) without a reasonable basis for the denial.
43 (2) A person engaged in the business of insurance may not unreasonably delay or
44 unreasonably deny payment of a claim for benefits owed to or on behalf of a first party
45 claimant.
46 (3) In a judicial action against an insurer to recover a claim, an insured may recover:
47 (a) reasonable attorney fees; and
48 (b) double the amount of the claim, if the court finds an:
49 (i) unreasonable delay; or
50 (ii) unreasonable denial.
51 (4) This section does not apply to:
52 (a) insurance issued in compliance with Title 34A, Chapter 2, Workers' Compensation
53 Act; or
54 (b) title insurance issued in compliance with this title.
55 Section 2. Effective date.
56 This bill takes effect on May 1, 2024.