2020 Statute Promises Greater Transparency Regarding Liable Party’s Insurance Coverage
A new Colorado law that went into effect at the beginning of 2020 may have a major impact on personal injury cases by helping injured people learn how best to pursue their claims.
Colorado law C.R.S. § 10-3-1117 will help Coloradoans determine whether their uninsured or underinsured motorist coverage is applicable. Persons injured in an automobile accident can now get the at-fault driver’s insurance policy to pay for their damages without having to file a lawsuit.
How to Obtain Insurance Info from the Parties at Fault
The new law requires that insurers who
may provide commercial automobile or personal automobile liability insurance coverage to pay all or a portion of a pending or prospective claim shall provide to the claimant or the claimant’s attorney…within thirty calendar days after receiving a written request from the claimant or the claimant’s attorney…a statement setting forth the following information with regard to each known policy of insurance of the named insured…:
(I) The name of the insurer;
(II) The name of each insured party, as the name appears on the declarations page of the policy;
(III) The limits of the liability coverage; and
(IV) A copy of the policy.
If the insurance carrier does not comply with the request for names and terms within 30 days of receiving the request, a penalty of “one hundred dollars per day” will be assessed, along with attorney’s fees and other costs required to enforce the penalty.
The Colorado Division of Insurance provides a form for requesting automobile insurance policy information. To complete the form, you must have the opposing party’s insurance information and determine whether the Colorado Division of Insurance is the insurer’s registered agent.
Why Plaintiffs Need to Know About the At-Fault Party’s Insurance Policy
Before the new law was enacted, some insurers refused to provide injured parties with information about the at-fault driver’s coverage until a lawsuit was filed.
This meant that plaintiffs and their attorneys were obliged to negotiate without all the information they needed. They had to more or less guess whether the at-fault driver’s insurance would fully compensate the injured person. Injured parties thus had to make medical decisions without knowing whether there was adequate insurance coverage to pay for surgery or other expensive treatments. And some plaintiffs failed to obtain reasonable and necessary medical treatment for fear that the liable party lacked the coverage to fully pay for it and that they, the victims, might have to go into debt to treat injuries caused by the liable party’s negligence.
Insurance carriers may argue that persons injured in automobile accidents have an incentive to pursue excessive or unwarranted treatment if they learn that the liable party has generous liability coverage. But these carriers can still challenge treatment that they regard as unnecessary or too expensive.
Moreover, proponents contend that the new law may well reduce litigation costs for both the insurance provider and the claimant. If all parties know that the at-fault party has only the state-mandated minimum amount of coverage, then the plaintiff may be unwilling to incur the costs of suing and may instead try to settle the claim out of court.