Colorado Prohibits Insurers from Unreasonably Delaying or Denying Benefits

Since June 2008, Colorado has prohibited insurers from unreasonably delaying or denying benefits to policy holders and has provided additional remedies of an award of attorney fees and damages of double the amount of covered benefits. The law does not apply to worker’s compensation, title or life insurance. The statutes (C.R.S. §§ 10-3-1115 and 1116) also prohibit giving discretion to the insurer, plan administrator, or claim administrator to interpret the terms of health or disability policies, contracts, or plans issued in Colorado. Insurance policies, contracts or plans must provide that health, life, or disability benefit claimants, who have been denied and exhausted administrative remedies, are entitled to bring their claims before juries. On the whole these new statues provide a powerful incentive to insurers to adjust claims promptly and fairly and a potent weapon for policy-holders whose claims are unreasonably delayed or denied.

POSTED BY: WESLEY B. HOWARD, ESQ.