H. B. 3312
(By Delegates Miley and Rick Thompson)
[Introduced March 25, 2005; referred to the
Committee on Banking and Insurance then the Judiciary.]
A BILL to amend the Code of West Virginia, 1931, as amended, by
adding thereto a new section, designated §33-11-4a, relating
to providing prerequisites to filing third-party bad faith
claims under the West Virginia Unfair Trade Practices Act.
Be it enacted by the Legislature of West Virginia:
That the Code of West Virginia, 1931, as amended, be amended
by adding thereto a new section, designated §33-11-4a, to read as
follows:
ARTICLE 11. UNFAIR TRADE PRACTICES.
§33-11-4a. Prerequisite for filing a third-party cause of action.
Every private cause of action brought under chapter nine
herein for third-party bad faith, shall comply with the following
prerequisites:
(a) Notwithstanding any other provision herein, no person may
file a third-party cause of action for violation of this article until sixty days following the filing of the underlying tort or
negligence complaint: Provided, That following the expiration of
such time period, and compliance with the remainder of this
section, the claimant shall be freely permitted to amend the
underlying tort or negligence complaint pursuant to Rule 15 of the
West Virginia Civil Procedure;
(b) Notwithstanding any other provision herein, should an
insurer be named in a civil complaint as a party defendant for
violation of this article in accordance herewith the prerequisites
herein, such insurer shall not be required to respond thereto in
any manner, whether by answer or other responsive pleading, and all
proceedings with regarding to such alleged violations shall be
stayed until the underlying tort or negligence claim is fully and
completely resolved: Provided, That said insurer shall be required
to respond to a lawfully issued subpoena or other service of
process to the same extent required by law as if it were not a
party defendant;
(c) As a condition precedent to bringing an action under this
section, the Insurance Commissioner and the insurer must have been
given thirty days advance written notice of the violation. If the
Insurance Commissioner returns a notice for lack of specificity,
the thirty-day time period shall not begin until a proper notice is
filed;
(d) The notice shall substantially comply with the following requirements:
(1) The statutory provision, including the specific language
of the statute, which the authorized insurer allegedly violated.
(2) The facts and circumstances giving rise to the violation.
(3) The name of the insurer involved in the violation.
(4) A statement that the notice is given in order to perfect
the right to pursue the civil remedy authorized by this section.
(e) Within ten days of receipt of the notice, the Insurance
Commissioner may return any notice that does not provide the
specific information required by this section, and the Insurance
Commissioner shall indicate with specificity the deficiencies
contained in the notice;
(f) No action shall lie if, within thirty days after filing
notice, the damages are paid or the circumstances giving rise to
the violation are corrected;
(g) If the insurer fails to take corrective action within said
thirty-day period, the claimant need not provide further notice of
subsequent violations prior to pursuing a remedy for damages
arising therefrom; nor shall the claimant be required to provide
notice, hereunder, of any deficiency discovered once the bad faith
civil action is commenced;
(h) The insurer that is the recipient of a notice filed
pursuant to this section shall report to the Insurance Commissioner
on the disposition of the alleged violation, including corrective action taken and/or damages paid if any;
(i) The applicable statute of limitations for an action under
this section shall be tolled for a period of ninety days following
the mailing of the notice required by this subsection or any
renotice required by the Insurance Commissioner;
(j) Upon adverse adjudication at trial or upon appeal, the
insurer shall be liable for all consequential damages, together
with court costs and reasonable attorney's fees incurred by the
complainant.
NOTE: The purpose of this bill is to provide prerequisites to
filing third-party bad faith claims under the West Virginia Unfair
Trade Practices Act.
This section is new; therefore, strike-throughs and
underscoring have been omitted.
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