H. B. 4478
(By Delegates Staton, Trump and Rowe)
[Introduced February 18, 1998; referred to the
Committee on Banking and Insurance then the Judiciary.]
A BILL to amend article six, chapter thirty-three of the code of
West Virginia, one thousand nine hundred thirty-one, as
amended, by adding thereto a new section, designated section
thirty-one-e, relating generally to the procedures to be
followed in giving notice to an underinsured motorist
coverage carrier of an offer from a liability insurance
company carrier indemnifying a tortfeasor to settle with a
claimant for policy limits; delineating the contents of the
notice; and establishing the requirements to be followed by
an underinsured motorist coverage carrier which wants to
preserve its subrogation rights, including the payment of
money within time limits.
Be it enacted by the Legislature of West Virginia:
That article six, chapter thirty-three of the code of West
Virginia, one thousand nine hundred thirty-one, as amended, be amended by adding thereto a new section, designated section
thirty-one-e, to read as follows:
ARTICLE 6. THE INSURANCE POLICY.
§33-6-31e. Notice of proposed settlement for policy limits to underinsured motorist coverage carrier; waiver of subrogation; time limits.
(a) When a liability insurer indemnifying a tortfeasor
offers to pay its full policy limits of coverage to a claimant in
a claim involving a motor vehicle accident, conditioned upon an
underinsured motorist coverage carrier waiving its rights of
subrogation against the tortfeasor, then the claimant or the
liability insurer indemnifying the tortfeasor may give to the
underinsured motorist coverage carrier notice in writing that an
offer to settle for policy limits has been made by the liability
insurer indemnifying the tortfeasor.
(b) The notice shall be in writing and sent by certified
mail, return receipt requested, to the underinsured motorist
coverage carrier, and it shall state plainly the following
information:
(1) The name and address of the underinsured motorist
coverage claimant;
(2) The name and address of the person in whose name the
underinsured motorist coverage is written;
(3) The policy number of the policy under which the underinsured motorist coverage is written;
(4) The name of the tortfeasor;
(5) The name of the insurance company and the policy number
for the insurance policy indemnifying the tortfeasor under which
an offer to settle for policy limits has been made;
(6) A statement that the company indemnifying the tortfeasor
has offered to settle with the claimant for policy limits,
conditioned upon the waiver by the underinsured motorist coverage
carrier of its subrogation rights against the tortfeasor; and
(7) A statement that under the law the underinsured motorist
coverage carrier has thirty days to preserve its subrogation
rights against the tortfeasor by providing written notice of its
intention to do so and by paying to the claimant an amount equal
to the policy limits that have been offered to the claimant by
the liability insurance company indemnifying the tortfeasor.
(c) The underinsured motorist coverage carrier is considered
to have fully waived its rights of subrogation against the
tortfeasor, unless within thirty days from receipt of the notice
described in subsection (b) above, the underinsured motorist
coverage carrier sends in writing by certified mail, return
receipt requested, to the claimant and to the liability insurer
indemnifying the tortfeasor written notice that it does not waive
its rights of subrogation against the tortfeasor. This notice is
not effective unless the notice to the claimant is accompanied by payment to the claimant of an amount equal to the policy limits
which had been offered by the liability insurance company
indemnifying the tortfeasor. If the underinsured motorist
carrier fails to send the notice provided for in this subsection
or fails to pay the sum required by this subsection within the
time specified, then the underinsured motorist coverage carrier
is considered to have waived its subrogation rights against the
tortfeasor, and the claimant may proceed to consummate the
settlement about which notice had been provided, as set forth in
subsections (a) and (b) of this section.
(d) If the underinsured motorist carrier gives notice and
tenders the payment, as required in subsection (c) of this
section, then the underinsured motorist carrier is and remains
subrogated to the rights of the claimant as to the tortfeasor to
the extent of any and all sums paid by the underinsured motorist
carrier to the claimant, as provided under current law.
NOTE: The purpose of this bill is to provide a procedure to
be followed when there is a proposed settlement for the policy
limits to the underinsured motorist carrier.
This section is new; therefore, strike-throughs and
underscoring have been omitted.