It is an unfair claim settlement practice and a violation of this subtitle for an insurer, nonprofit health service plan, or health maintenance organization, when committed with the frequency to indicate a general business practice, to:
(1) misrepresent pertinent facts or policy provisions that relate to the claim or coverage at issue;
(2) fail to acknowledge and act with reasonable promptness on communications about claims that arise under policies;
(3) fail to adopt and implement reasonable standards for the prompt investigation of claims that arise under policies;
(4) refuse to pay a claim without conducting a reasonable investigation based on all available information;
(5) fail to affirm or deny coverage of claims within a reasonable time after proof of loss statements have been completed;
(6) fail to make a prompt, fair, and equitable good faith attempt, to settle claims for which liability has become reasonably clear;
(7) compel insureds to institute litigation to recover amounts due under policies by offering substantially less than the amounts ultimately recovered in actions brought by the insureds;
(8) attempt to settle a claim for less than the amount to which a reasonable person would expect to be entitled after studying written or printed advertising material accompanying, or made part of, an application;
(9) attempt to settle a claim based on an application that is altered without notice to, or the knowledge or consent of, the insured;
(10) fail to include with each claim paid to an insured or beneficiary a statement of the coverage under which the payment is being made;
(11) make known to insureds or claimants a policy of appealing from arbitration awards in order to compel insureds or claimants to accept a settlement or compromise less than the amount awarded in arbitration;
(12) delay an investigation or payment of a claim by requiring a claimant or a claimant's licensed health care provider to submit a preliminary claim report and subsequently to submit formal proof of loss forms that contain substantially the same information;
(13) fail to settle a claim promptly whenever liability is reasonably clear under one part of a policy, in order to influence settlements under other parts of the policy;
(14) fail to provide promptly a reasonable explanation of the basis for denial of a claim or the offer of a compromise settlement;
(15) refuse to pay a claim for an arbitrary or capricious reason based on all available information;
(16) fail to meet the requirements of Title 15, Subtitle 10B of this article for preauthorization for a health care service;
(17) fail to comply with the provisions of Title 15, Subtitle 10A of this article; or
(18) fail to act in good faith, as defined under § 27-1001 of this title, in settling a first-party claim under a policy of property and casualty insurance.
Credits
Added by Acts 1997, c. 35, § 2, eff. Oct. 1, 1997. Amended by Acts 1998, c. 111, § 2, eff. Jan. 1, 1999; Acts 1998, c. 112, § 2, eff. Jan. 1, 1999; Acts 1999, c. 71, § 1, eff. June 1, 1999; Acts 2007, c. 150, § 1, eff. Oct. 1, 2007; Acts 2014, c. 355, § 2, eff. June 1, 2014.
Current through legislation effective through April 9, 2023, from the 2024 Regular Session of the General Assembly. Some statute sections may be more current, see credits for details.
