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