HB 1187 Summary

• Defines "third-party claim" and establishes that only insureds or assignees can sue insurers for failure to accept settlement offers within policy limits.

• Requires third-party claimants to provide written settlement demands meeting specific requirements (signed, stated amount within limits, detailed explanation of coverage/liability/damages, list of witnesses and documents).

• Limits insurer liability when competing third-party claims exceed policy limits if insurer files interpleader action within 90 days or submits claims to binding arbitration with prorated distribution.

• Prohibits multipliers or enhancements in awards of attorney's fees and costs; caps damages against uninsured motorist carriers at no more than twice the policy limits.

• Replaces common-law bad faith claims with statutory remedies; requires 60-day preaction notice to Department of Financial Regulation and insurer (except for third-party claims) before filing suit.