Insurance: insurers; processing of a claim; modify duties. Amends 1956 PA 218 (MCL 500.100 - 500.8302) by adding ch. 30B.
Impact
The introduction of Chapter 30B is set to significantly enhance consumer protections within the insurance industry in Michigan. By clearly outlining the obligations of insurers to act in good faith, the bill aims to curtail improper practices such as bad faith claims handling. It requires insurers to not only uphold existing contractual obligations but expands on them by enforcing new standards that protect the rights of policyholders. This shift may lead to an increased accountability for insurers and potentially reduce litigation costs related to claim disputes.
Summary
Senate Bill 0329, known as the Insurance Policyholder Bill of Rights, aims to amend the Michigan insurance code by adding Chapter 30B. This new chapter establishes extensive rights for policyholders, especially in the claims process. It asserts that claimants, whether first party or third party, are entitled to fair treatment and timely resolution of their claims. The bill seeks to prevent insurers from denying or delaying claims without reasonable justification, mandating that insurers must provide clear and timely communication about claims, including status updates and necessary documentation.
Contention
Despite the potential benefits, SB 0329 presents notable points of contention among stakeholders. Supporters argue that the bill will foster a more equitable insurance environment, allowing policyholders to navigate claims without undue barrier or delay. Conversely, opponents, particularly from within the insurance industry, may contend that these new provisions could lead to increased operational burdens and costs, ultimately affecting premium rates for consumers. The balance between protecting policyholder rights and ensuring a stable insurance market remains a critical discussion point as the bill progresses.
Insurance: insurers; processing of a claim; modify duties. Amends secs. 2005, 2006, 2026 & 2049 of 1956 PA 218 (MCL 500.2005 et seq.) & adds sec. 2005b & ch. 30B.
Insurance: other; the insurance code of 1956; amend to reflect amendments to the public health code. Amends sec. 2006 of 1956 PA 218 (MCL 500.2006). TIE BAR WITH: HB 5477'24
Insurance: insurers; processing of a claim; modify duties. Amends secs. 2005, 2006, 2026 & 2049 of 1956 PA 218 (MCL 500.2005 et seq.) & adds sec. 2005b & ch. 30B.