31A-22-305 - Uninsured motorist coverage.
31A-22-305. Uninsured motorist coverage.
(1) As used in this section, "covered persons" includes:
(a) the named insured;
(b) persons related to the named insured by blood, marriage, adoption, or guardianship,who are residents of the named insured's household, including those who usually make theirhome in the same household but temporarily live elsewhere;
(c) any person occupying or using a motor vehicle:
(i) referred to in the policy; or
(ii) owned by a self-insured; and
(d) any person who is entitled to recover damages against the owner or operator of theuninsured or underinsured motor vehicle because of bodily injury to or death of persons underSubsection (1)(a), (b), or (c).
(2) As used in this section, "uninsured motor vehicle" includes:
(a) (i) a motor vehicle, the operation, maintenance, or use of which is not covered undera liability policy at the time of an injury-causing occurrence; or
(ii) (A) a motor vehicle covered with lower liability limits than required by Section31A-22-304; and
(B) the motor vehicle described in Subsection (2)(a)(ii)(A) is uninsured to the extent ofthe deficiency;
(b) an unidentified motor vehicle that left the scene of an accident proximately caused bythe motor vehicle operator;
(c) a motor vehicle covered by a liability policy, but coverage for an accident is disputedby the liability insurer for more than 60 days or continues to be disputed for more than 60 days;or
(d) (i) an insured motor vehicle if, before or after the accident, the liability insurer of themotor vehicle is declared insolvent by a court of competent jurisdiction; and
(ii) the motor vehicle described in Subsection (2)(d)(i) is uninsured only to the extentthat the claim against the insolvent insurer is not paid by a guaranty association or fund.
(3) (a) Uninsured motorist coverage under Subsection 31A-22-302(1)(b) providescoverage for covered persons who are legally entitled to recover damages from owners oroperators of uninsured motor vehicles because of bodily injury, sickness, disease, or death.
(b) For new policies written on or after January 1, 2001, the limits of uninsured motoristcoverage shall be equal to the lesser of the limits of the insured's motor vehicle liability coverageor the maximum uninsured motorist coverage limits available by the insurer under the insured'smotor vehicle policy, unless the insured purchases coverage in a lesser amount by signing anacknowledgment form that:
(i) is filed with the department;
(ii) is provided by the insurer;
(iii) waives the higher coverage;
(iv) reasonably explains the purpose of uninsured motorist coverage; and
(v) discloses the additional premiums required to purchase uninsured motorist coveragewith limits equal to the lesser of the limits of the insured's motor vehicle liability coverage or themaximum uninsured motorist coverage limits available by the insurer under the insured's motorvehicle policy.
(c) A self-insured, including a governmental entity, may elect to provide uninsured
motorist coverage in an amount that is less than its maximum self-insured retention underSubsections (3)(b) and (4)(a) by issuing a declaratory memorandum or policy statement from thechief financial officer or chief risk officer that declares the:
(i) self-insured entity's coverage level; and
(ii) process for filing an uninsured motorist claim.
(d) Uninsured motorist coverage may not be sold with limits that are less than theminimum bodily injury limits for motor vehicle liability policies under Section 31A-22-304.
(e) The acknowledgment under Subsection (3)(b) continues for that issuer of theuninsured motorist coverage until the insured, in writing, requests different uninsured motoristcoverage from the insurer.
(f) (i) In conjunction with the first two renewal notices sent after January 1, 2001, forpolicies existing on that date, the insurer shall disclose in the same medium as the premiumrenewal notice, an explanation of:
(A) the purpose of uninsured motorist coverage; and
(B) the costs associated with increasing the coverage in amounts up to and including themaximum amount available by the insurer under the insured's motor vehicle policy.
(ii) The disclosure required under this Subsection (3)(f) shall be sent to all insureds thatcarry uninsured motorist coverage limits in an amount less than the insured's motor vehicleliability policy limits or the maximum uninsured motorist coverage limits available by the insurerunder the insured's motor vehicle policy.
(4) (a) (i) Except as provided in Subsection (4)(b), the named insured may rejectuninsured motorist coverage by an express writing to the insurer that provides liability coverageunder Subsection 31A-22-302(1)(a).
(ii) This rejection shall be on a form provided by the insurer that includes a reasonableexplanation of the purpose of uninsured motorist coverage.
(iii) This rejection continues for that issuer of the liability coverage until the insured inwriting requests uninsured motorist coverage from that liability insurer.
(b) (i) All persons, including governmental entities, that are engaged in the business of,or that accept payment for, transporting natural persons by motor vehicle, and all school districtsthat provide transportation services for their students, shall provide coverage for all motorvehicles used for that purpose, by purchase of a policy of insurance or by self-insurance,uninsured motorist coverage of at least $25,000 per person and $500,000 per accident.
(ii) This coverage is secondary to any other insurance covering an injured coveredperson.
(c) Uninsured motorist coverage:
(i) is secondary to the benefits provided by Title 34A, Chapter 2, Workers' CompensationAct;
(ii) may not be subrogated by the workers' compensation insurance carrier;
(iii) may not be reduced by any benefits provided by workers' compensation insurance;
(iv) may be reduced by health insurance subrogation only after the covered person hasbeen made whole;
(v) may not be collected for bodily injury or death sustained by a person:
(A) while committing a violation of Section 41-1a-1314;
(B) who, as a passenger in a vehicle, has knowledge that the vehicle is being operated inviolation of Section 41-1a-1314; or
(C) while committing a felony; and
(vi) notwithstanding Subsection (4)(c)(v), may be recovered:
(A) for a person under 18 years of age who is injured within the scope of Subsection(4)(c)(v) but limited to medical and funeral expenses; or
(B) by a law enforcement officer as defined in Section 53-13-103, who is injured withinthe course and scope of the law enforcement officer's duties.
(d) As used in this Subsection (4), "motor vehicle" has the same meaning as underSection 41-1a-102.
(5) When a covered person alleges that an uninsured motor vehicle under Subsection(2)(b) proximately caused an accident without touching the covered person or the motor vehicleoccupied by the covered person, the covered person must show the existence of the uninsuredmotor vehicle by clear and convincing evidence consisting of more than the covered person'stestimony.
(6) (a) The limit of liability for uninsured motorist coverage for two or more motorvehicles may not be added together, combined, or stacked to determine the limit of insurancecoverage available to an injured person for any one accident.
(b) (i) Subsection (6)(a) applies to all persons except a covered person as defined underSubsection (7)(b)(ii).
(ii) A covered person as defined under Subsection (7)(b)(ii) is entitled to the highestlimits of uninsured motorist coverage afforded for any one motor vehicle that the covered personis the named insured or an insured family member.
(iii) This coverage shall be in addition to the coverage on the motor vehicle the coveredperson is occupying.
(iv) Neither the primary nor the secondary coverage may be set off against the other.
(c) Coverage on a motor vehicle occupied at the time of an accident shall be primarycoverage, and the coverage elected by a person described under Subsections (1)(a) and (b) shallbe secondary coverage.
(7) (a) Uninsured motorist coverage under this section applies to bodily injury, sickness,disease, or death of covered persons while occupying or using a motor vehicle only if the motorvehicle is described in the policy under which a claim is made, or if the motor vehicle is a newlyacquired or replacement motor vehicle covered under the terms of the policy. Except as providedin Subsection (6) or this Subsection (7), a covered person injured in a motor vehicle described ina policy that includes uninsured motorist benefits may not elect to collect uninsured motoristcoverage benefits from any other motor vehicle insurance policy under which the person is acovered person.
(b) Each of the following persons may also recover uninsured motorist benefits underany one other policy in which they are described as a "covered person" as defined in Subsection(1):
(i) a covered person injured as a pedestrian by an uninsured motor vehicle; and
(ii) except as provided in Subsection (7)(c), a covered person injured while occupying orusing a motor vehicle that is not owned, leased, or furnished:
(A) to the covered person;
(B) to the covered person's spouse; or
(C) to the covered person's resident parent or resident sibling.
(c) (i) A covered person may recover benefits from no more than two additional policies,
one additional policy from each parent's household if the covered person is:
(A) a dependent minor of parents who reside in separate households; and
(B) injured while occupying or using a motor vehicle that is not owned, leased, orfurnished:
(I) to the covered person;
(II) to the covered person's resident parent; or
(III) to the covered person's resident sibling.
(ii) Each parent's policy under this Subsection (7)(c) is liable only for the percentage ofthe damages that the limit of liability of each parent's policy of uninsured motorist coverage bearsto the total of both parents' uninsured coverage applicable to the accident.
(d) A covered person's recovery under any available policies may not exceed the fullamount of damages.
(e) A covered person in Subsection (7)(b) is not barred against making subsequentelections if recovery is unavailable under previous elections.
(f) (i) As used in this section, "interpolicy stacking" means recovering benefits for asingle incident of loss under more than one insurance policy.
(ii) Except to the extent permitted by Subsection (6) and this Subsection (7), interpolicystacking is prohibited for uninsured motorist coverage.
(8) (a) When a claim is brought by a named insured or a person described in Subsection(1) and is asserted against the covered person's uninsured motorist carrier, the claimant may electto resolve the claim:
(i) by submitting the claim to binding arbitration; or
(ii) through litigation.
(b) Unless otherwise provided in the policy under which uninsured benefits are claimed,the election provided in Subsection (8)(a) is available to the claimant only.
(c) Once the claimant has elected to commence litigation under Subsection (8)(a)(ii), theclaimant may not elect to resolve the claim through binding arbitration under this section withoutthe written consent of the uninsured motorist carrier.
(d) (i) Unless otherwise agreed to in writing by the parties, a claim that is submitted tobinding arbitration under Subsection (8)(a)(i) shall be resolved by a single arbitrator.
(ii) All parties shall agree on the single arbitrator selected under Subsection (8)(d)(i).
(iii) If the parties are unable to agree on a single arbitrator as required under Subsection(8)(d)(ii), the parties shall select a panel of three arbitrators.
(e) If the parties select a panel of three arbitrators under Subsection (8)(d)(iii):
(i) each side shall select one arbitrator; and
(ii) the arbitrators appointed under Subsection (8)(e)(i) shall select one additionalarbitrator to be included in the panel.
(f) Unless otherwise agreed to in writing:
(i) each party shall pay an equal share of the fees and costs of the arbitrator selectedunder Subsection (8)(d)(i); or
(ii) if an arbitration panel is selected under Subsection (8)(d)(iii):
(A) each party shall pay the fees and costs of the arbitrator selected by that party; and
(B) each party shall pay an equal share of the fees and costs of the arbitrator selectedunder Subsection (8)(e)(ii).
(g) Except as otherwise provided in this section or unless otherwise agreed to in writing
by the parties, an arbitration proceeding conducted under this section shall be governed by Title78B, Chapter 11, Utah Uniform Arbitration Act.
(h) The arbitration shall be conducted in accordance with Rules 26 through 37, 54, and68 of the Utah Rules of Civil Procedure.
(i) All issues of discovery shall be resolved by the arbitrator or the arbitration panel.
(j) A written decision by a single arbitrator or by a majority of the arbitration panel shallconstitute a final decision.
(k) (i) The amount of an arbitration award may not exceed the uninsured motorist policylimits of all applicable uninsured motorist policies, including applicable uninsured motoristumbrella policies.
(ii) If the initial arbitration award exceeds the uninsured motorist policy limits of allapplicable uninsured motorist policies, the arbitration award shall be reduced to an amount equalto the combined uninsured motorist policy limits of all applicable uninsured motorist policies.
(l) The arbitrator or arbitration panel may not decide the issues of coverage orextra-contractual damages, including:
(i) whether the claimant is a covered person;
(ii) whether the policy extends coverage to the loss; or
(iii) any allegations or claims asserting consequential damages or bad faith liability.
(m) The arbitrator or arbitration panel may not conduct arbitration on a class-wide orclass-representative basis.
(n) If the arbitrator or arbitration panel finds that the action was not brought, pursued, ordefended in good faith, the arbitrator or arbitration panel may award reasonable attorney fees andcosts against the party that failed to bring, pursue, or defend the claim in good faith.
(o) An arbitration award issued under this section shall be the final resolution of allclaims not excluded by Subsection (8)(l) between the parties unless:
(i) the award was procured by corruption, fraud, or other undue means; or
(ii) either party, within 20 days after service of the arbitration award:
(A) files a complaint requesting a trial de novo in the district court; and
(B) serves the nonmoving party with a copy of the complaint requesting a trial de novounder Subsection (8)(o)(ii)(A).
(p) (i) Upon filing a complaint for a trial de novo under Subsection (8)(o), the claim shallproceed through litigation pursuant to the Utah Rules of Civil Procedure and Utah Rules ofEvidence in the district court.
(ii) In accordance with Rule 38, Utah Rules of Civil Procedure, either party may requesta jury trial with a complaint requesting a trial de novo under Subsection (8)(o)(ii)(A).
(q) (i) If the claimant, as the moving party in a trial de novo requested under Subsection(8)(o), does not obtain a verdict that is at least $5,000 and is at least 20% greater than thearbitration award, the claimant is responsible for all of the nonmoving party's costs.
(ii) If the uninsured motorist carrier, as the moving party in a trial de novo requestedunder Subsection (8)(o), does not obtain a verdict that is at least 20% less than the arbitrationaward, the uninsured motorist carrier is responsible for all of the nonmoving party's costs.
(iii) Except as provided in Subsection (8)(q)(iv), the costs under this Subsection (8)(q)shall include:
(A) any costs set forth in Rule 54(d), Utah Rules of Civil Procedure; and
(B) the costs of expert witnesses and depositions.
(iv) An award of costs under this Subsection (8)(q) may not exceed $2,500.
(r) For purposes of determining whether a party's verdict is greater or less than thearbitration award under Subsection (8)(q), a court may not consider any recovery or other reliefgranted on a claim for damages if the claim for damages:
(i) was not fully disclosed in writing prior to the arbitration proceeding; or
(ii) was not disclosed in response to discovery contrary to the Utah Rules of CivilProcedure.
(s) If a district court determines, upon a motion of the nonmoving party, that the movingparty's use of the trial de novo process was filed in bad faith in accordance with Section78B-5-825, the district court may award reasonable attorney fees to the nonmoving party.
(t) Nothing in this section is intended to limit any claim under any other portion of anapplicable insurance policy.
(u) If there are multiple uninsured motorist policies, as set forth in Subsection (7), theclaimant may elect to arbitrate in one hearing the claims against all the uninsured motoristcarriers.
(9) (a) Within 30 days after a covered person elects to submit a claim for uninsuredmotorist benefits to binding arbitration or files litigation, the covered person shall provide to theuninsured motorist carrier:
(i) a written demand for payment of uninsured motorist coverage benefits, setting forth:
(A) the specific monetary amount of the demand; and
(B) the factual and legal basis and any supporting documentation for the demand;
(ii) a written statement under oath disclosing:
(A) (I) the names and last known addresses of all health care providers who haverendered health care services to the covered person that are material to the claims for whichuninsured motorist benefits are sought for a period of five years preceding the date of the eventgiving rise to the claim for uninsured motorist benefits up to the time the election for arbitrationor litigation has been exercised; and
(II) whether the covered person has seen other health care providers who have renderedhealth care services to the covered person, which the covered person claims are immaterial to theclaims for which uninsured motorist benefits are sought, for a period of five years preceding thedate of the event giving rise to the claim for uninsured motorist benefits up to the time theelection for arbitration or litigation has been exercised that have not been disclosed underSubsection (9)(a)(ii)(A)(I);
(B) (I) the names and last known addresses of all health insurers or other entities towhom the covered person has submitted claims for health care services or benefits material to theclaims for which uninsured motorist benefits are sought, for a period of five years preceding thedate of the event giving rise to the claim for uninsured motorist benefits up to the time theelection for arbitration or litigation has been exercised; and
(II) whether the identity of any health insurers or other entities to whom the coveredperson has submitted claims for health care services or benefits, which the covered person claimsare immaterial to the claims for which uninsured motorist benefits are sought, for a period of fiveyears preceding the date of the event giving rise to the claim for uninsured motorist benefits up tothe time the election for arbitration or litigation have not been disclosed;
(C) if lost wages, diminished earning capacity, or similar damages are claimed, allemployers of the covered person for a period of five years preceding the date of the event giving
rise to the claim for uninsured motorist benefits up to the time the election for arbitration orlitigation has been exercised;
(D) other documents to reasonably support the claims being asserted; and
(E) all state and federal statutory lienholders including a statement as to whether thecovered person is a recipient of Medicare or Medicaid benefits or Utah Children's HealthInsurance Program benefits under Title 26, Chapter 40, Utah Children's Health Insurance Act, orif the claim is subject to any other state or federal statutory liens; and
(iii) signed authorizations to allow the uninsured motorist carrier to only obtain recordsand billings from the individuals or entities disclosed.
(b) (i) If the uninsured motorist carrier determines that the disclosure of undisclosedhealth care providers or health care insurers under Subsection (9)(a)(ii) is reasonably necessary,the uninsured motorist carrier may:
(A) make a request for the disclosure of the identity of the health care providers or healthcare insurers; and
(B) make a request for authorizations to allow the uninsured motorist carrier to onlyobtain records and billings from the individuals or entities not disclosed.
(ii) If the covered person does not provide the requested information within 10 days:
(A) the covered person shall disclose, in writing, the legal or factual basis for the failureto disclose the health care providers or health care insurers; and
(B) either the covered person or the uninsured motorist carrier may request the arbitratoror arbitration panel to resolve the issue of whether the identities or records are to be provided ifthe covered person has elected arbitration.
(iii) The time periods imposed by Subsection (9)(c)(i) are tolled pending resolution of thedispute concerning the disclosure and production of records of the health care providers or healthcare insurers.
(c) (i) An uninsured motorist carrier that receives an election for arbitration or a notice offiling litigation and the demand for payment of uninsured motorist benefits under Subsection(9)(a)(i) shall have a reasonable time, not to exceed 60 days from the date of the demand andreceipt of the items specified in Subsections (9)(a)(i) through (iii), to:
(A) provide a written response to the written demand for payment provided for inSubsection (9)(a)(i);
(B) except as provided in Subsection (9)(c)(i)(C), tender the amount, if any, of theuninsured motorist carrier's determination of the amount owed to the covered person; and
(C) if the covered person is a recipient of Medicare or Medicaid benefits or UtahChildren's Health Insurance Program benefits under Title 26, Chapter 40, Utah Children's HealthInsurance Act, or if the claim is subject to any other state or federal statutory liens, tender theamount, if any, of the uninsured motorist carrier's determination of the amount owed to thecovered person less:
(I) if the amount of the state or federal statutory lien is established, the amount of thelien; or
(II) if the amount of the state or federal statutory lien is not established, two times theamount of the medical expenses subject to the state or federal statutory lien until such time as theamount of the state or federal statutory lien is established.
(ii) If the amount tendered by the uninsured motorist carrier under Subsection (9)(c)(i) isthe total amount of the uninsured motorist policy limits, the tendered amount shall be accepted
by the covered person.
(d) A covered person who receives a written response from an uninsured motorist carrieras provided for in Subsection (9)(c)(i), may:
(i) elect to accept the amount tendered in Subsection (9)(c)(i) as payment in full of alluninsured motorist claims; or
(ii) elect to:
(A) accept the amount tendered in Subsection (9)(c)(i) as partial payment of all uninsuredmotorist claims; and
(B) litigate or arbitrate the remaining claim.
(e) If a covered person elects to accept the amount tendered under Subsection (9)(c)(i) aspartial payment of all uninsured motorist claims, the final award obtained through arbitration,litigation, or later settlement shall be reduced by any payment made by the uninsured motoristcarrier under Subsection (9)(c)(i).
(f) In an arbitration proceeding on the remaining uninsured claims:
(i) the parties may not disclose to the arbitrator or arbitration panel the amount paidunder Subsection (9)(c)(i) until after the arbitration award has been rendered; and
(ii) the parties may not disclose the amount of the limits of uninsured motorist benefitsprovided by the policy.
(g) If the final award obtained through arbitration or litigation is greater than the averageof the covered person's initial written demand for payment provided for in Subsection (9)(a)(i)and the uninsured motorist carrier's initial written response provided for in Subsection (9)(c)(i),the uninsured motorist carrier shall pay:
(i) the final award obtained through arbitration or litigation, except that if the awardexceeds the policy limits of the subject uninsured motorist policy by more than $15,000, theamount shall be reduced to an amount equal to the policy limits plus $15,000; and
(ii) any of the following applicable costs:
(A) any costs as set forth in Rule 54(d), Utah Rules of Civil Procedure;
(B) the arbitrator or arbitration panel's fee; and
(C) the reasonable costs of expert witnesses and depositions used in the presentation ofevidence during arbitration or litigation.
(h) (i) The covered person shall provide an affidavit of costs within five days of anarbitration award.
(ii) (A) Objection to the affidavit of costs shall specify with particularity the costs towhich the uninsured motorist carrier objects.
(B) The objection shall be resolved by the arbitrator or arbitration panel.
(iii) The award of costs by the arbitrator or arbitration panel under Subsection (9)(g)(ii)may not exceed $5,000.
(i) (i) A covered person shall disclose all material information, other than rebuttalevidence, as specified in Subsection (9)(a).
(ii) If the information under Subsection (9)(i)(i) is not disclosed, the covered person maynot recover costs or any amounts in excess of the policy under Subsection (9)(g).
(j) This Subsection (9) does not limit any other cause of action that arose or may ariseagainst the uninsured motorist carrier from the same dispute.
(k) The provisions of this Subsection (9) only apply to motor vehicle accidents that occuron or after March 30, 2010.
Amended by Chapter 354, 2010 General Session