The bill amends the "Unfair Claims Settlement Practices Act" by defining "unfair claims practices" and specifying acts that would constitute such practices if committed by an insurer. These include misrepresenting policy details, failing to promptly handle claims, not attempting fair settlements, and forcing insured parties to sue for due amounts. It also addresses misleading claimants about statutes of limitations, failing to respond to claims within 30 days, and coercing claimants regarding rental car company use. The bill introduces changes such as increasing the damage threshold for requiring a licensed appraiser from $2,500 to $5,000 and extending the time for an insurer's appraiser to perform an initial appraisal from three to four business days.

Furthermore, the bill updates the law on how a motor vehicle is designated as a total loss by insurance companies, stating that a vehicle cannot be considered a total loss if the rebuild or reconstruction cost is less than seventy-five percent of its pre-accident fair market value. It clarifies the definition of "fair market value" and requires detailed, fair, and reasonable itemization of condition adjustments for vehicles deemed a total loss. The bill also mandates written consent and acknowledgment from the owner if the insurer does not retain salvage. It addresses negotiations with unlicensed public adjusters, payment for necessary sublet services to auto body repair shops, and the non-applicability of certain subsections if there is a contract between repair facilities and insurance companies. The threshold for requiring a licensed appraiser is increased to an amount exceeding $5,000, and the act will take effect upon passage.

Statutes affected:
7287: 27-9.1-4