Substitute House Bill No. 6435, now Public Act No. 25-131, modifies the arbitration process for disputes between claimants and insurance companies regarding automobile physical damage and property damage liability claims. The bill repeals subsection (b) of section 38a-9 and introduces a new arbitration procedure effective October 1, 2025. This procedure is applicable only to disputes involving private passenger motor vehicles where liability and coverage are not in dispute. It mandates that all licensed insurance companies participate in the arbitration process, which will only accept disputes after mediation attempts have failed. Each party must pay a filing fee of twenty dollars, and the insurance company is required to pay the claimant the undisputed amount of the claim upon referral to arbitration.

The bill also outlines the appointment of arbitrators, the scheduling of hearings, and the decision-making process. Notably, if the arbitrator's decision favors the claimant, it must include specific remedies such as interest on the awarded amount and reimbursement of the department's costs unless the claimant rejected a pre-arbitration offer of equal or greater value. The bill prohibits the Insurance Department from altering any arbitrator's decision and establishes a process for judicial review of arbitration awards. Additionally, the department is tasked with maintaining records of disputes and compiling annual statistics for legislative review.