Timely payment of claims.

1. Law
2. Utah Code
3. Insurance Code
4. Insurance Adjusters
5. Claim Practices
6. Timely payment of claims.

• (1)
  • (a) Unless otherwise provided by law, an insurer shall timely pay every valid insurance claim made by an insured.
  • (b) By rule the commissioner may prescribe:
    • (i) the kinds of notice and proof of loss that will establish validity;
    • (ii) the manner in which an insurer may make a bona fide denial of a claim;
    • (iii) the periods of time within which payment is required to be made to be timely; and
    • (iv) the reasonable interest rates to be charged upon late claim payments.

• (2)
  • (a) Notwithstanding Subsection (1) and subject to Subsection (2)(b), the payment of a claim is not overdue during any period in which:
    • (i) the insurer is unable to pay the claim because there is no recipient legally able to give a valid release for the payment; or
    • (ii) the insurer is unable to determine who is entitled to receive the payment.
  • (b) Subsection (2)(a) applies only if the insurer:
    • (i) promptly notifies the claimant of the inability to pay the claim; and
    • (ii) offers in good faith to pay the claim promptly when the inability to pay the claim is removed.

• (3) This section applies only to a claim for first party benefits made by a person who is:
  • (a) named or defined as an insured under the terms of an insurance policy;
  • (b) described as a covered person under the terms of a policy of health care insurance as defined in Section 31A-1-301; or
  • (c) named, defined, or described:
    • (i) as:
      • (A) an insured;
      • (B) a beneficiary;
      • (C) a policyholder; or
      • (D) otherwise covered person; and
    • (ii) under the terms of:
      • (A) a life insurance policy; or
      • (B) an annuity.

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