ENROLLED
H. B. 4220
(By Delegates Beane, Michael, Mezzatesta,
Ashley, L. White and Azinger)
[Passed March 14, 1998; in effect ninety days from passage.]
AN ACT to amend article six, chapter thirty-three of the code of
West Virginia, one thousand nine hundred thirty-one, as
amended, by adding a new section, designated section thirty- one-e; and to amend and reenact section one, article six-a
of said chapter, all relating to automobile liability
insurance; establishing a procedure for written notification
of an offer to settle for policy limits to an underinsured
motorist coverage carrier; setting forth notice
requirements; establishing requirements for preservation of
subrogation rights by underinsured motorist coverage
carrier; eliminating requirement that notice of cancellation
of coverage be given by registered or certified mail; and
making certain technical revisions.
Be it enacted by the Legislature of West Virginia:
That article six, chapter thirty-three of the code of West
Virginia, one thousand nine hundred thirty-one, as amended, be
amended by adding thereto a new section, designated section
thirty-one-e; and that section one, article six-a of said chapter, be amended and reenacted, all to read as follows:
ARTICLE 6. THE INSURANCE POLICY.
§33-6-31e. Notice of proposed settlement for policy limits to
underinsured motorist coverage carrier; waiver of
subrogation; time limits.
(a) When an automobile liability insurer indemnifying a
tortfeasor offers to pay its full policy limits of coverage for
bodily injury or death to a claimant in a claim involving a motor
vehicle accident, conditioned upon an underinsured motorist
coverage carrier waiving its rights of subrogation against the
tortfeasor, then the claimant or the liability insurer
indemnifying the tortfeasor may give to the underinsured motorist
coverage carrier notice in writing that an offer to settle for
policy limits has been made by the liability insurer indemnifying
the tortfeasor.
(b) The notice shall be in writing and sent by certified
mail, return receipt requested, to the underinsured motorist
coverage carrier, and it shall state plainly the following
information:
(1) The name and address of the underinsured motorist
coverage claimant;
(2) The name and address of the person in whose name the
underinsured motorist coverage is written;
(3) The policy number of the policy under which the
underinsured motorist coverage is written;
(4) The name of the tortfeasor;
(5) The name of the insurance company and the policy
number for the insurance policy indemnifying the tortfeasor under
which an offer to settle for policy limits has been made;
(6) A statement that the company indemnifying the
tortfeasor has offered to settle with the claimant for policy
limits, conditioned upon the waiver by the underinsured motorist
coverage carrier of its subrogation rights against the
tortfeasor; and
(7) A statement that under the law the underinsured
motorist coverage carrier has sixty days to preserve its
subrogation rights against the tortfeasor by providing written
notice of its intention to do so and by paying to the claimant an
amount equal to the policy limits that have been offered to the
claimant by the liability insurance company indemnifying the
tortfeasor.
(c) The underinsured motorist coverage carrier is
considered to have fully waived its rights of subrogation against
the tortfeasor, unless within sixty days from receipt of the
notice described in subsection (b) above, the underinsured
motorist coverage carrier sends in writing by certified mail,
return receipt requested, to the claimant and to the liability
insurer indemnifying the tortfeasor written notice that it does
not waive its rights of subrogation against the tortfeasor. This
notice is not effective unless the notice to the claimant is
accompanied by payment to the claimant of an amount equal to the
policy limits which had been offered by the liability insurance company indemnifying the tortfeasor. If the underinsured motorist
carrier fails to send the notice provided for in this subsection
or fails to pay the sum required by this subsection within the
time specified, then the underinsured motorist coverage carrier
is considered to have waived its subrogation rights against the
tortfeasor, and the claimant may proceed to consummate the
settlement about which notice had been provided, as set forth in
subsections (a) and (b) of this section.
(d) If the underinsured motorist carrier gives notice and
tenders the payment, as required in subsection (c) of this
section, then the underinsured motorist carrier is and remains
subrogated to the rights of the claimant as to the tortfeasor to
the extent of any and all sums paid by the underinsured motorist
carrier to the claimant, as provided under current law. The
payment by the underinsured motorist coverage carrier of the
amount equal to the policy limits offered by the liability
insurer indemnifying the tortfeasor, as provided for in this
section, shall not serve in any way to waive, change or increase
the amount of the applicable underinsured motorist coverage
beyond the underlying underinsured motorist coverage policy
limits.
(e) The provisions of this section shall apply only to
written notices sent to underinsured motorist coverage carriers
on or after the effective date of this section.
ARTICLE 6A. CANCELLATION OR NONRENEWAL OF AUTOMOBILE LIABILITY
POLICIES.
§33-6A-1. Cancellation prohibited except for specified reasons;
notice.
No insurer once having issued or delivered a policy
providing automobile liability insurance in this state insuring
a private passenger automobile may, after the policy has been in
effect for sixty days, or in case of renewal effective
immediately, issue or cause to issue a notice of cancellation
during the term of the policy except for one or more of the
reasons specified in this section:
(a) The named insured fails to discharge when due any of his
or her obligations in connection with the payment of premium for
the policy or any installment of the premium;
(b) The policy was obtained through material
misrepresentation;
(c) The insured violates any of the material terms and
conditions of the policy;
(d) The named insured or any other operator, either resident
in the same household or who customarily operates an automobile
insured under the policy:
(1) Has had his or her operator's license suspended or
revoked during the policy period including suspension or
revocation for failure to comply with the provisions of article
five-a, chapter seventeen-c of this code, regarding consent for
a chemical test for intoxication: Provided,
That when a license
is suspended for sixty days by the commissioner of motor vehicles
because a person did drive a motor vehicle while under the age of twenty-one years with an alcohol concentration in his or her
blood of two hundredths of one percent or more, by weight, but
less than ten hundredths of one percent, by weight, pursuant to
subsection (l), section two, article five-a, chapter seventeen-c
of this code, the suspension shall not be grounds for
cancellation; or
(2) Is or becomes subject to epilepsy or heart attacks, and
the individual cannot produce a certificate from a physician
testifying to his or her ability to operate a motor vehicle.
(e) The named insured or any other operator, either resident
in the same household or who customarily operates an automobile
insured under such policy is convicted of or forfeits bail during
the policy period for any of the following:
(1) Any felony or assault involving the use of a motor
vehicle;
(2) Negligent homicide arising out of the operation of a
motor vehicle;
(3) Operating a motor vehicle while under the influence of
alcohol or of any controlled substance or while having an alcohol
concentration in his or her blood of ten hundredths of one
percent or more, by weight;
(4) Leaving the scene of a motor vehicle accident in which
the insured is involved without reporting as required by law;
(5) Theft of a motor vehicle or the unlawful taking of a
motor vehicle;
(6) Making false statements in an application for a motor
vehicle operator's license;
(7) A third violation, committed within a period of twelve months, of any moving traffic violation which constitutes a
misdemeanor, whether or not the violations were repetitious of
the same offense or were different offenses. Notwithstanding any
of the provisions of this section to the contrary, no insurance
company may cancel a policy of automobile liability insurance
without first giving the insured thirty days' notice of its
intention to cancel: Provided,
That cancellation of the
insurance policy by the insurance carrier for failure of
consideration to be paid by the insured upon initial issuance of
the insurance policy is effective upon the expiration of ten
days' notice of cancellation to the insured.