Notice concerning use of insurance proceeds

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  1. (a) When making payment to a third party on a claim under a motor vehicle insurance policy for damage to a motor vehicle, a motor vehicle liability insurer shall provide a written notice to the third-party claimant in substantially the following form:

  2. (b) The written notice required by subsection (a) of this section may be provided by including the written notice on each written loss estimate prepared in connection with the claim.

“Failure to use the insurance proceeds in accordance with a security agreement between you and a lienholder, if any, may constitute the criminal offense of defrauding a secured creditor in violation of Arkansas Code § 5-37-203. If you have any questions, contact your lienholder.”


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