Southwest Insurance Coverage & Bad Faith Newsletter

Enactment of C.R.S. § 10-3-1117 (Colorado)

(Disclosure Requirements For Auto Insurers - First and Third-Party Claims)

(February 2021) - Effective January 1, 2020, the Colorado legislature enacted C.R.S. § 10-3-1117, which imposes new disclosure requirements on auto insurers for both first and third-party auto claims. The statute applies to any insurer that issues a commercial automobile or personal automobile policy for delivery in Colorado. In the event of a violation, the statute provides for penalties and attorneys’ fees.

Written Request from an Insured

Subsection (1) of the statute requires an auto insurer to “provide to the insured party a copy of the complete policy of insurance, including any endorsements” within “thirty calendar days after receiving a written request from an insured party.”

Written Request from a Claimant

For a written request from a claimant sent to the auto insurer’s registered agent, subsection (2) of the statute requires an auto insurer to provide the following information:

(I)       The name of the insurer;

(II)     The name of each insured party, as the name appears on the declarations page of the policy;

(III)    The limits of the liability coverage; and

(IV)    A copy of the policy.

According to the Colorado Division of Insurance guidance, disclosure of “a copy of the policy” to a claimant under subsection (2) “does not include the declarations page or the application even if attached to the policy. . . .” 

The statement required of the insurer must include the above information for “each known policy of insurance of the named insured, including excess or umbrella insurance, that is or may be relevant to the claim.”

The statement must be provided to the claimant “within thirty calendar days after receiving a written request from the claimant or the claimant's attorney, which request is sent to the insurer's registered agent. . . .”

Subsection (4) of the statute prohibits the claimant and claimant’s attorney from disclosing this information to any third parties.

Penalties and Attorney’s Fees

The statute imposes a $100 per day penalty for failure to comply with the disclosure requirements, beginning on day thirty-one. The statute also provides for an award of “attorney fees and costs incurred by a claimant in enforcing the penalty.”

The availability of attorney’s fees for “enforcing the penalty” indicates that the statute may be interpreted to permit a private right of action for violations. However, this issue has not yet been litigated.

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