South Dakota § 58-12-34 - Acts constituting unfair claims practices.

§ 58-12-34. Acts constituting unfair claims practices.

Any of the following acts by an insurer, if committed in violation of § 58-12-33, is an unfair claims practice:

(1)    Knowingly misrepresents to a claimant or an insured a relevant fact or policy provision relating to coverages at issue;

(2)    Fails to acknowledge with reasonable promptness pertinent communications with respect to claims arising under its policies;

(3)    Fails to adopt and implement reasonable standards to promptly complete claim investigations and settlement of claims arising under its policies;

(4)    Fails to make a good faith attempt to effectuate prompt, fair, and equitable settlement of claims submitted in which liability coverage, and causation of claims have become reasonably clear;

(5)    Compels an insured or beneficiary to institute a suit to recover an amount due under its policies by offering substantially less than the amount ultimately recovered in a suit brought by the insured or beneficiary;

(6)    Refuses to pay claims without conducting a reasonable claim investigation;

(7)    Fails to affirm or deny coverage of claims within a reasonable time after having completed a claim investigation related to the claim;

(8)    Attempts to settle a claim for less than the amount that a reasonable person would believe the insured or beneficiary is entitled by reference to written or printed advertising material accompanying or made part of an application;

(9)    Attempts to settle a claim on the basis of an application that was materially altered without notice to, or knowledge or consent of, the insured;

(10)    Makes a claim payment to an insured or beneficiary without indicating the coverage under which each payment is being made;

(11)    Unreasonably delays a claim investigation or payment of a claim by requiring both a formal proof of loss form and subsequent verification that would result in duplication of information and verification appearing in the formal proof of loss form;

(12)    Fails, in the case of a claim denial or offer of compromise settlement, to promptly provide a reasonable and accurate explanation of the basis for such action; or

(13)    Fails to provide forms necessary to present a claim within fifteen days of a request with reasonable explanations regarding their use.

Source: SL 2014, ch 235, § 4.