The bill amends the New Mexico Insurance Code to define and prohibit an additional unfair claims practice. It outlines a series of practices that insurers or other persons may engage in that are considered unfair and deceptive, thereby prohibited. These practices include misrepresenting facts or policy provisions, failing to acknowledge and act promptly on claims communications, and not adopting reasonable standards for claim investigations. The bill also addresses issues such as delaying claim payments, compelling litigation for recovery, and failing to provide explanations for claim denials.

Among the specific practices defined in the bill, new provisions include the requirement for insurers to settle catastrophic claims within a ninety-day period after a claim number is assigned and to inform insureds of the coverage under which a claim payment has been made upon request. Additionally, the bill prohibits insurers from treating inquiries about damage or loss as claims when they do not involve deceptive practices and no payment is made. Overall, the bill aims to enhance consumer protection by ensuring fair treatment of insured individuals in the claims process.

Statutes affected:
introduced version: 59A-16-20
Final Version: 59A-16-20