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Capital IconMinnesota Legislature

HF 3

as introduced - 85th Legislature, 2007 1st Special Session (2007 - 2007) Posted on 12/15/2009 12:00am

KEY: stricken = removed, old language.
underscored = added, new language.

Current Version - as introduced

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A bill for an act
relating to insurance; prohibiting insurers from penalizing insureds for certain
types of motor vehicle claims and from providing certain incorrect information
regarding the effect of a motor vehicle claim on future insurability or premium
rates; amending Minnesota Statutes 2006, sections 65B.133, subdivision 5a;
72A.20, subdivision 12.


Section 1.

Minnesota Statutes 2006, section 65B.133, subdivision 5a, is amended to

Subd. 5a.

deleted text beginSurchargedeleted text end Prohibitionnew text begin on adverse consequencesnew text end.

No new text begincancellation,
new text endsurcharge deleted text beginis chargeable todeleted text endnew text begin, or other future increase in premium rates may be
imposed upon
new text end an insured who collects benefits under a policy because the insured isnew text begin:
new text end

new text begin (1)new text end a passenger in a bus, taxi, or commuter van involved in an accidentnew text begin; or
new text end

new text begin (2) a driver or passenger in a vehicle that was on a bridge when the bridge collapsednew text end.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 2.

Minnesota Statutes 2006, section 72A.20, subdivision 12, is amended to read:

Subd. 12.

Unfair service.

Causing or permitting with such frequency to indicate a
general business practice any unfair, deceptive, or fraudulent act concerning any claim or
complaint of an insured or claimant including, but not limited to, the following practices:

(1) misrepresenting pertinent facts or insurance policy provisions relating to
coverages at issue;

(2) failing to acknowledge and act reasonably promptly upon communications with
respect to claims arising under insurance policies;

(3) failing to adopt and implement reasonable standards for the prompt investigation
of claims arising under insurance policies;

(4) refusing to pay claims without conducting a reasonable investigation based
upon all available information;

(5) failing to affirm or deny coverage of claims within a reasonable time after proof
of loss statements have been completed;

(6) not attempting in good faith to effectuate prompt, fair, and equitable settlements
of claims in which liability has become reasonably clear;

(7) compelling insureds to institute litigation to recover amounts due under an
insurance policy by offering substantially less than the amounts ultimately recovered in
actions brought by the insureds;

(8) attempting to settle a claim for less than the amount to which reasonable persons
would have believed they were entitled by reference to written or printed advertising
material accompanying or made part of an application;

(9) attempting to settle claims on the basis of an application which was altered
without notice to, or knowledge or consent of, the insured;

(10) making claims payments to insureds or beneficiaries not accompanied by a
statement setting forth the coverage under which the payments are being made;

(11) making known to insureds or claimants a policy of appealing from arbitration
awards in favor of insureds or claimants for the purpose of compelling them to accept
settlements or compromises less than the amount awarded in arbitration;

(12) delaying the investigation or payment of claims by requiring an insured,
claimant, or the physician of either to submit a preliminary claim report and then requiring
the subsequent submission of formal proof of loss forms, both of which submissions
contain substantially the same information;

(13) failing to promptly settle claims, where liability has become reasonably clear,
under one portion of the insurance policy coverage in order to influence settlements under
other portions of the insurance policy coverage;

(14) failing to promptly provide a reasonable explanation of the basis in the
insurance policy in relation to the facts or applicable law for denial of a claim or for the
offer of a compromise settlement;

(15) requiring an insured to provide information or documentation that is or would
be dated more than five years prior to or five years after the date of a fire loss, except for
proof of ownership of the damaged propertynew text begin;
new text end

new text begin (16) stating or implying to an insured that filing a claim for no-fault motor vehicle
insurance benefits would or may result in cancellation or nonrenewal of the insured's
policy or in a surcharge or other future increase in premium rates, when any such
consequence of filing the claim would be prohibited by law;
new text end

new text begin (17) failing to promptly inform an insured who files a claim described in section
65B.133, subdivision 5a, of the provisions of that law, both orally and in writing
new text end.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end