UT SB0074

Policy-limit demand letters in motor vehicle third-party liability claims must include sufficient information to evaluate the claim (incident description, injuries, liability basis, medical records and bills, economic damages) and provide insurers at least 30 days to accept or reject the demand.

Claimants contacting an unrepresented insured after an insurer declines to tender policy limits must provide written correspondence with a copy to the insurer, including a plain-language explanation of claims, injury descriptions, the original demand letter, and notice of intended legal action.

Claimants must wait 45 days after the insured receives correspondence before filing suit, unless necessary to preserve legal rights.

Liability insurance carriers must provide written disclosure to the insured within 30 days stating whether they will defend against the claim and indemnify for any verdict, judgment, settlement, or award, including whether indemnification is limited to policy limits.

Effective May 6, 2026; the bill does not create a private cause of action but allows courts to consider noncompliance as evidence when evaluating bad faith claims.