West Virginia has adopted amendments to the Insurance Regulation Series 14 on Unfair Trade Practices effective April 24, 2006 which govern communications with policy holders and claimants.  While many of the previous timeframes in Series 14 remain in effect, several changes, including requirements and prohibitions, merit immediate attention. 

3.  The new regulation actually increases, albeit slightly, the time period for notifying claimants of a delay in the investigation.  If an insurer needs more than 30 calendar days from receipt of the proof or notice of a claim, it shall notify the claimant in writing within 15 days after the 30-day period expires.  The insurer shall then send written notification of the delay to the claimant every 45 calendar days until the investigation is complete. Note that settlement of total and partial settlements of property damage claims under automobile policies are governed by shorter time frames under 114-14-7.   (114-14-6.7)

4.  Insurers are now prohibited from offering any incentive or compensation to its employees based on savings resulting from an improper denial of a claim. (114-14-6.15)

5.  An insurer may not deduct a premium payment from settlement money or claim payment owed without the insured’s consent. (114-14-6.16)

6.  Any notice rejecting any element of a claim must contain: (1) the identity and address of the claims processing office of the insurer; (2) the claim number; (3) a notice that the claimant has the option of contacting the Commissioner; (4) the Commissioner’s mailing address, telephone number and website address. (114-14-6.17)

7.  Within 90 days of the effective date of this rule [the effective date was April 24, 2006], every insurer shall adopt and communicate to its claims agents written standards for the prompt investigation and processing of claims. (114-14-8)

For more information regarding these rules, a complete summary of all changes to the regulations or a copy of the new regulations, please contact Jenkins Fenstermaker.