ARIZONA HOUSE OF REPRESENTATIVES FIRST REGULAR SESSION - 1999

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_DPA_ For Committee on BANKING AND INSURANCE

_____ For Committee on

_X___ For Caucus and COW

_____ As Passed the House

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Abstract for HB. 2649 (disclosure; prohibitions; motor vehicle repair) Sponsor: Brimhall

HB 2649 amends ARS 20-456 and amends Title 20, Chapter 2, Article 6 ARS by adding section 20-461.01 to place procedural restrictions on insurers when paying motor vehicle damage repair claims.

Provisions:

· Insurers, insurance agents, solicitors or adjusters are restricted from:

A) placing limits or restrictions on policy coverage by specifying certain parts or products to be used in the repair of the automobile;

B) asking for or accepting a referral fee or gratuity from any person in exchange for referring the claimant to a particular repair person or facility;

C) discouraging or restricting the claimant's own choice of a repair person or facility;

D) any contractual agreement between an insurer and a repair person or facility shall not result in the substandard repairs or a compromise in the structural integrity and safety of the automobile;

E) requiring an insured or claimant to travel an unreasonable distance to have the damage repaired.

· HB 2649 states that any agreement between an insurer and a repair person or facility which provides discounts for parts or labor must not:

A) lower the standard of repairs or parts;

B) reduce the coverage under the insured's policy.

· An insurer shall not prohibit a repair person or facility from stating the description, manufacturer or source of the parts used in the repair and the amount charged to the insurer for those parts and related labor.

· The insurer or adjuster must provide written notice to the insured or claimant that contains the provisions in this bill.

· If an insurer violates any part of 20-461.01, any insured, claimant or repair person or facility may file a written complaint to the Director of the Department of Insurance.

HB 2649 was amended in the Banking and Insurance Committee as follows:

Specified that a claimant is a third party claimant.

Prepared by: Jonathan Dinesman, Isaac Gabriel

hb2649.cow 2/23/99 bh

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