Any of the following acts by an insurer doing
accident and health insurance, property insurance, casualty
insurance, surety insurance, marine insurance, or title insurance
business, if committed without just cause and performed with such
frequency as to indicate a general business practice, constitutes
improper claim practices:
(1) Knowingly misrepresenting to insureds or
third-party claimants pertinent facts or policy provisions relating
to coverages at issue or providing deceptive or misleading
information with respect to coverages.
(2) Failing to acknowledge with reasonable
promptness pertinent communications with respect to claims arising
under its policies, including third-party claims arising under
liability insurance policies.
(3) Failing to adopt and implement reasonable
standards for the prompt investigation and settlement of claims,
including third-party liability claims, arising under its policies.
(4) Not attempting in good faith to effect
prompt, fair, and equitable settlement of claims, including
third-party liability claims, submitted to it in which liability has
become reasonably clear.
(5) Compelling policyholders or claimants,
including third-party claimants under liability policies, to
institute suits to recover amounts reasonably due or payable with
respect to claims arising under its policies by offering
substantially less than the amounts ultimately recovered through
suits brought by the claimants or through settlements with their
attorneys employed as the result of the inability of the claimants
to effect reasonable settlements with the insurers.
(6) Offering to settle claims, including
third-party liability claims, for an amount less than the amount
otherwise reasonably due or payable based upon the possibility or
probability that the policyholder or claimant would be required to
incur attorneys' fees to recover the amount reasonably due or
payable.
(7) Invoking or threatening to invoke policy
defenses or to rescind the policy as of its inception, not in good
faith and with a reasonable expectation of prevailing with respect
to the policy defense or attempted rescission, but for the primary
purpose of discouraging or reducing a claim, including a third-party
liability claim.
(8) Any other practice which constitutes an
unreasonable delay in paying or an unreasonable failure to pay or
settle in full claims, including third-party liability claims,
arising under coverage provided by its policies.
