SF 137

Introduction - 83rd Legislature (2003 - 2004)

Posted on 12/15/2009 12:00 a.m.

  1.1                          A bill for an act 
  1.2             relating to insurance; property; regulating coverage 
  1.3             for items to be sold by an insured in the business of 
  1.4             selling these items; amending Minnesota Statutes 2002, 
  1.5             section 72A.201, subdivision 5. 
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  Minnesota Statutes 2002, section 72A.201, 
  1.8   subdivision 5, is amended to read: 
  1.9      Subd. 5.  [STANDARDS FOR FAIR SETTLEMENT OFFERS AND 
  1.10  AGREEMENTS.] The following acts by an insurer, an adjuster, a 
  1.11  self-insured, or a self-insurance administrator constitute 
  1.12  unfair settlement practices:  
  1.13     (1) making any partial or final payment, settlement, or 
  1.14  offer of settlement, which does not include an explanation of 
  1.15  what the payment, settlement, or offer of settlement is for; 
  1.16     (2) making an offer to an insured of partial or total 
  1.17  settlement of one part of a claim contingent upon agreement to 
  1.18  settle another part of the claim; 
  1.19     (3) refusing to pay one or more elements of a claim by an 
  1.20  insured for which there is no good faith dispute; 
  1.21     (4) threatening cancellation, rescission, or nonrenewal of 
  1.22  a policy as an inducement to settlement of a claim; 
  1.23     (5) notwithstanding any inconsistent provision of section 
  1.24  65A.01, subdivision 3, failing to issue payment for any amount 
  1.25  finally agreed upon in settlement of all or part of any claim 
  2.1   within five business days from the receipt of the agreement by 
  2.2   the insurer or from the date of the performance by the claimant 
  2.3   of any conditions set by such agreement, whichever is later; 
  2.4      (6) failing to inform the insured of the policy provision 
  2.5   or provisions under which payment is made; 
  2.6      (7) settling or attempting to settle a claim or part of a 
  2.7   claim with an insured under actual cash value provisions for 
  2.8   less than the value of the property immediately preceding the 
  2.9   loss, including all applicable taxes and license fees.  In no 
  2.10  case may an insurer be required to pay an amount greater than 
  2.11  the amount of insurance; 
  2.12     (8) except where limited by policy provisions, settling or 
  2.13  offering to settle a claim or part of a claim with an insured 
  2.14  under replacement value provisions for less than the sum 
  2.15  necessary to replace the damaged item with one of like kind and 
  2.16  quality, including all applicable taxes, license, and transfer 
  2.17  fees; 
  2.18     (9) reducing or attempting to reduce for depreciation any 
  2.19  settlement or any offer of settlement for items not adversely 
  2.20  affected by age, use, or obsolescence; 
  2.21     (10) reducing or attempting to reduce for betterment any 
  2.22  settlement or any offer of settlement unless the resale value of 
  2.23  the item has increased over the preloss value by the repair of 
  2.24  the damage; 
  2.25     (11) settling or offering to settle a claim involving 
  2.26  damaged items for less than the sum necessary to replace the 
  2.27  damaged items with new items of like kind and quality when, 
  2.28  prior to the damage, these items had been offered for sale as 
  2.29  new by an insured in the business of selling such items.  This 
  2.30  clause does not apply to any settlement or offer of settlement 
  2.31  agreed to in writing by the insured after receiving from the 
  2.32  insurer full disclosure of all options open to the insured and, 
  2.33  after having been given at least 48 hours to evaluate those 
  2.34  options.  This written agreement cannot be required by an 
  2.35  insurer as a condition of payment of the claim.