Every claims representative likely considers the insurer'sgeneral duty of good faith and fair dealing when they receivenotice of a new claim, or at least they should. But what is “fair”when it comes to handling property and casualty claims?Unfortunately, the answer could be different in each of the 50states. On one hand, each state has provided a starting point forthat consideration by issuing either a statutory or regulatorylegal standard advancing required and unfair actions or practicesin handling and settling property and casualty claims.

Most states utilize some version or portion of the NationalAssociation of Insurance Commissioners (“NAIC”) Model Unfair ClaimsSettlement Practices Act or Model Unfair Property/CasualtySettlement Practices Regulations. However, each state has its ownmodification or specialization of those model legal authorities, orhas enacted its own unique laws in order to accomplish the samegoal or purpose.

Generally, the purpose of these laws is to set forth minimumstandards for the investigation and disposition of property andcasualty claims under insurance contracts (utilizing the purposeset out by NAIC in the model statutes and regulations). Theseminimum standards are all basically protections for each individualpresenting a claim to an insurer, whether an insured or third-partyclaimant.