| 1 | 1 | | H.B. 563 |
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| 2 | 2 | | LEGISLATIVE GENERAL COUNSEL |
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| 3 | 3 | | 6 Approved for Filing: A. Shewan 6 |
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| 4 | 4 | | 6 02-24-23 2:01 PM 6 |
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| 5 | 5 | | H.B. 563 |
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| 6 | 6 | | 1 INSURANCE DAMAGES AMENDMENTS |
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| 7 | 7 | | 2 2023 GENERAL SESSION |
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| 8 | 8 | | 3 STATE OF UTAH |
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| 9 | 9 | | 4 Chief Sponsor: Douglas R. Welton |
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| 10 | 10 | | 5 Senate Sponsor: ____________ |
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| 11 | 11 | | 6 |
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| 12 | 12 | | 7LONG TITLE |
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| 13 | 13 | | 8General Description: |
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| 14 | 14 | | 9 This bill amends provisions related to actions to recover insurance claims. |
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| 15 | 15 | | 10Highlighted Provisions: |
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| 16 | 16 | | 11 This bill: |
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| 17 | 17 | | 12 <provides that in an action to recover a claim on certain insurance, an insured is |
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| 18 | 18 | | 13entitled to: |
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| 19 | 19 | | 14 Creasonable attorney's fees; and |
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| 20 | 20 | | 15 Cdouble the amount of the claim, if the court finds the insurer unreasonably |
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| 21 | 21 | | 16delayed or unreasonably denied a claim; and |
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| 22 | 22 | | 17 <defines terms. |
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| 23 | 23 | | 18Money Appropriated in this Bill: |
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| 24 | 24 | | 19 None |
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| 25 | 25 | | 20Other Special Clauses: |
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| 26 | 26 | | 21 None |
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| 27 | 27 | | 22Utah Code Sections Affected: |
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| 28 | 28 | | 23ENACTS: |
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| 29 | 29 | | 24 31A-26-314, Utah Code Annotated 1953 |
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| 30 | 30 | | 25 |
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| 31 | 31 | | 26Be it enacted by the Legislature of the state of Utah: |
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| 32 | 32 | | 27 Section 1. Section 31A-26-314 is enacted to read: |
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| 33 | 33 | | *HB0563* H.B. 563 02-24-23 2:01 PM |
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| 34 | 34 | | - 2 - |
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| 35 | 35 | | 28 31A-26-314. Improper denial of claims prohibited -- Remedies. |
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| 36 | 36 | | 29 (1) As used in this section: |
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| 37 | 37 | | 30 (a) (i) "First party claimant" means a person who asserts an entitlement to benefits |
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| 38 | 38 | | 31owed directly to or on behalf of an insured under an insurance policy. |
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| 39 | 39 | | 32 (ii) "First party claimant" does not include: |
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| 40 | 40 | | 33 (A) a nonparticipating provider performing services; or |
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| 41 | 41 | | 34 (B) a person asserting a claim against an insured under a liability policy. |
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| 42 | 42 | | 35 (b) "Unreasonable delay" means failure to comply with: |
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| 43 | 43 | | 36 (i) Section 31A-26-301; and |
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| 44 | 44 | | 37 (ii) rules the commissioner makes in accordance with Section 31A-26-301. |
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| 45 | 45 | | 38 (c) "Unreasonable denial" means a denial of a claim: |
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| 46 | 46 | | 39 (i) that is the result of, or in conjunction with, a violation of Section 31A-26-303; or |
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| 47 | 47 | | 40 (ii) without a reasonable basis for the denial. |
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| 48 | 48 | | 41 (2) A person engaged in the business of insurance may not unreasonably delay or |
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| 49 | 49 | | 42unreasonably deny payment of a claim for benefits owed to or on behalf of a first party |
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| 50 | 50 | | 43claimant. |
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| 51 | 51 | | 44 (3) In a judicial action against an insurer to recover a claim, an insured may recover: |
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| 52 | 52 | | 45 (a) reasonable attorney fees; and |
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| 53 | 53 | | 46 (b) double the amount of the claim, if the court finds an: |
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| 54 | 54 | | 47 (i) unreasonable delay; or |
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| 55 | 55 | | 48 (ii) unreasonable denial. |
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| 56 | 56 | | 49 (4) This section does not apply to: |
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| 57 | 57 | | 50 (a) insurance issued in compliance with Title 34A, Chapter 2, Workers' Compensation |
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| 58 | 58 | | 51Act; or |
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| 59 | 59 | | 52 (b) title insurance issued in compliance with this title. |
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