Insurance: other; post-claim underwriting; prohibit. Amends sec. 2026 of 1956 PA 218 (MCL 500.2026).
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Progress
Where this bill stands in the legislative process.
- Introduced
- Passed Senate
- Passed House
- To Governor
- Became Law
Overview
This bill prohibits insurance companies from using post-claim underwriting to deny coverage or increase premiums. It expands the definition of unfair practices in the insurance industry to include actions taken after a claim has been filed, such as delaying investigations or offering unreasonably low settlements. The bill also requires insurers to maintain records of customer complaints and ensures timely communication with policyholders regarding claim denials.
Key provisions
- Prohibits post-claim underwriting for denial or premium increases.
- Expands the definition of unfair insurance practices.
- Requires insurers to maintain records of customer complaints.
- Mandates timely communication regarding claim denials.
- Addresses issues related to claim investigation delays.
- Prohibits using advertising to mislead policyholders about claim settlements.
- Requires completion of underwriting before issuing policies.
- Prevents denial of claims based on facts discovered during claims investigation that would have been found during underwriting.
Who is affected
- Insurance companies
- Policyholders
- Claimants
- Insurance agents
Notable changes
- Broadens the scope of unfair practices beyond isolated incidents.
- Specifically addresses post-claim underwriting practices.
Bill text
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Document of record
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- Senate Introduced Bill
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