Section 25Sec./Art. 25

Unfair Claims Settlement Practices. - (a) No pre-need company shall refuse, without just cause, to pay or settle claims arising under coverages provided by its plans nor shall any such company engage in unfair claim settlement practices. Any of the following acts by a pre-need company, if committed without just cause, shall constitute unfair claims settlement practices:

(1) Knowingly misrepresenting to claimants pertinent facts or plan provisions relating to coverages at issue;

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

(3) Failing to adopt and implement reasonable standards for the prompt investigation of claims arising under its plan;

(4) Failing to provide prompt, fair and equitable settlement of claims submitted in which liability has become reasonably clear; or

(5) Compelling planholders to institute suits or recover amounts due under its plan by offering, without justifiable reason, substantially less than the amounts ultimately recovered in suits brought by them.

(b) Evidence as to the number and types of valid and justifiable complaints to the Commission against a pre-need company shall be deemed admissible in an administrative or judicial proceeding brought under this section.

(c) Any violation of this section shall be considered sufficient cause for the suspension or revocation of the company's certificate of authority.