On May 22, 2019, Colorado’s Governor, Jared Polis, signed House Bill 19-1283 into law, amending C.R.S. §10-3-1101, requiring insurers to provide certain automobile policy information upon claimant request or face significant penalties.[i]  The law took effect on January 1, 2020.

Rationale Behind the Law

 The bill declared it is in the best interests of Colorado citizens to have transparency in the insurance claims process to further the public policy of encouraging settlement and preventing unnecessary litigation.[ii]  The legislature wanted to pass the bill to help claimants and injured parties to fully understand the total amount of insurance coverage available to them.[iii]  In addition, because payment of uninsured and under-insured motorist benefits covers the difference between the amount of the limits of any legal liability coverage and the amount of the damages sustained, the state’s citizens need to have accurate and reliable information about the amount of legal liability coverage available for a claim.[iv]

Therefore, the aim of the law is twofold:

1.  Help Colorado residents evaluate whether their uninsured or under-insured motorist coverage will be triggered; and,
2. Allow an insurer who provides uninsured or under-insured motorist coverage or policies more time to evaluate and place reserves on claims.[v]

What Insurers are Required to Provide upon Request

With respect to insureds, within 30 calendar days after receiving a written request from an insured party, an insurer issuing a commercial automobile or personal automobile policy of insurance for delivery in Colorado must provide to the insured party a copy of the complete policy of insurance, including any endorsements.[vi]

As to all other claimants[vii] and/or a claimant’s attorney, whether a request is made pre-suit or post-filing of a complaint, an insurer that provides or may provide commercial automobile or personal automobile liability insurance coverage to pay all or a portion of a pending or prospective claim must provide via mail, facsimile, or electronic delivery, within 30 calendar days after receiving a written request to the insurer’s registered agent, a statement setting forth the following with regard to each known policy of insurance of the named insured, including excess or umbrella insurance, that is or may be relevant to the claim:

1. The name of the insurer;
2. The name of each insured party, as the name appears on the declarations page of the policy;
3. The limits of the liability coverage; and,
4. A copy of the policy.[viii]

Penalties for Non-Compliance        

An insurer that violates the statute will be liable to the requesting claimant for damages in the amount of $100.00 per day, beginning on and including the 31^st day following receipt of the claimant’s written request.[ix]  Moreover, the penalty accrues until the insurer provides the information required.[x]

An insurer that fails to make a disclosure is also responsible for attorney fees and costs incurred by a claimant in enforcing the penalty.[xi]

Confidentiality of Policy Information Provided

The statute requires a claimant and his/her attorney refrain from disclosing to any party the information obtained from an insurer pursuant to request, except that a claimant and an attorney of the claimant may discuss the information with the claimant’s insurer.[xii]

Insurance Carrier Service Requirements

Colorado’s Department of Insurance (“DOI”) provides an online list of auto insurance carriers’ registered agents to assist claimants who want to obtain a driver’s insurance policy information under C.R.S. § 10-3-1117.[xiii]  The statute requires claimants to serve their disclosure requests on the carrier’s agent of service.[xiv]

All insurance carriers registered to do business within Colorado should examine the DOI list.[xv]  Should a carrier not be listed therein, it should turn to the Colorado Secretary of State’s business entity database in order to identify its registered agent within the state.[xvi]

If it is determined that a carrier’s agent of service is the DOI, then claimants will submit their requests for policy information to the DOI via email.  The DOI will then transmit the claimant’s request directly to the carrier.  Accordingly, the DOI is requiring each carrier to provide it with updated service of process contact information, including an email address for electronic communication.[xvii]

The DOI has drafted an official request form;[xviii] however, as indicated, requests have and will come via correspondence (letter or email) directly from claimants’ attorneys.  The carrier’s 30-day deadline to respond will begin upon receipt of the written request.

Takeaway

 Insurance carriers must provide the policy information identified above upon receipt of the request.  When supplying the information, the best practice would be to indicate the claims professional is providing the information pursuant to the requirements of C.R.S. § 10-3-1117 and invite the claimant or his/her counsel to follow up if it is believed additional information is owed under the statute.  Ideally, this will help defend later claims for penalties and attorneys’ fees if the claimant decides to argue the carrier did not comply with disclosure requirements.

While the required disclosure of automobile policy information is triggered upon “receiving a written request to the insurer’s registered agent,” the best practice is for an insurer to provide the requested information even if the request is delivered directly to a claims professional by the claimant or claimant’s attorney via letter or email.

[i] House Bill 19-1283, https://leg.colorado.gov/bills/hb19-1283; see also C.R.S. § 10-3-1101.

[ii] C.R.S. § 10-3-1101(2).

[iii] Id.

[iv] Id.

[v] Id.

[vi] C.R.S. § 10-3-1117(1).

[vii] “‘Claimant’ means a person that has provided notice to an insurer of a potential claim.”  C.R.S. § 10-3-1117(5).

[viii] C.R.S. § 10-3-1117(2)(a).

[ix] C.R.S. § 10-3-1117(3).

[x] Id.

[xi] Id.

[xii] C.R.S. § 10-3-1117(4).

[xiii] https://drive.google.com/file/d/1__kruMAMcYqQEIezPDtiWnt8iu2rxjS2/view.

[xiv] C.R.S. § 10-3-1117(2)(a).

^[xv] https://drive.google.com/file/d/1__kruMAMcYqQEIezPDtiWnt8iu2rxjS2/view.

[xvi] https://www.sos.state.co.us/biz/BusinessEntityCriteriaExt.do?resetTransTyp=Y.

[xvii] The carrier must provide its contact information, including email address, to: DORA_INS_RulesandRecords@state.co.us.

[xviii] https://drive.google.com/file/d/169SlolLHN3DkkYJoKiHga_GmoEp229Zs/view.

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