Monday, May 5, 2008
DENVER—Today the Senate gave initial approval to the Insurance Accountability Act of 2008, which would push insurance companies to pay consumers what they are owed for valid claims. Sponsored by Senate Majority Leader Ken Gordon (D-Denver) and Speaker of the House H. Andrew Romanoff, HB08-1407 would strengthen the ability of the Insurance Commissioner to deter unreasonable conduct by an insurer, help consumers recover damages, and clarify the definition of restitution. “This bill creates penalties for insurance companies who fail to pay valid claims—it will protect Colorado citizens,” said Gordon. “Insurance companies that do the right thing will have nothing to fear.” The bill would provide the Division of Insurance increased authority to penalize bad conduct by state regulated insurance companies. It would also prohibit insurance companies from unreasonably delaying or denying benefits owed to policyholders. If an insurance company unfairly denies a legitimate claim, customers would be able to take their insurance company to court. In instances where a claim has been illegally denied, insurance companies would be directed by the court to pay the policyholder twice the full benefits owed plus insurance fees. HB08-1407 will next be considered by the full Senate on third and final reading.