This bill amends the Unfair Claims Settlement Practices Act to define "unfair claims practices" and outline specific acts that constitute unfair claims practices by an insurer. The bill adds several new acts to the list of unfair claims practices, including misrepresenting facts or policy provisions, failing to promptly acknowledge and act upon communications regarding claims, and refusing to pay claims without conducting a reasonable investigation. The bill also prohibits insurers from engaging in acts of intimidation, coercion, threat, or misrepresentation of consumer rights in relation to rental car companies for motor vehicle replacement services. Additionally, the bill requires insurers to honor a "direction to pay" executed by an insured or claimant indicating that they want the insurance company to directly pay their motor vehicle replacement rental benefit to the rental car company of their choice.

The bill also makes changes to the requirements for appraisals and repairs in auto body repair claims. It requires insurers to use a manual or system in its entirety in the appraisal of a motor vehicle and prohibits them from discounting documented charges by failing to use the system in its entirety. The bill also requires insurers to comply with the requirements of Section 31-47-12.1, which relates to the use of aftermarket parts in auto body repairs. Additionally, the bill increases the threshold for when an appraisal must be performed by a licensed appraiser from $2,500 to $5,000 and requires the appraiser to perform a physical inspection of the damaged motor vehicle. The bill also sets time limits for performing initial and supplemental appraisals in auto body repair claims and allows for extensions by mutual agreement between the auto body repair shop and the insurer. Finally, the bill modifies the definition of "total loss" for motor vehicles and establishes criteria for determining when a vehicle should be deemed a total loss based on the cost to rebuild or reconstruct the vehicle to its pre-accident condition.

Statutes affected:
5536: 27-9.1-4