ATTENTION: Nevada liability departments and auto insurance carriers! Nevada Senate Bill No. 435 was recently signed into law and there are two key points to be aware of: Disclosure of Policy Limits Demand and Voiding Releases. These both deal with pre-litigation situations.
1) Nevada law now requires a motor vehicle insurer to disclose the limits of the policy if the claimant provides a HIPAA authorization which allows the carrier to “receive all medical reports, records and bills related to the claim from the providers of health care.” This is a change from the previous Nevada statute which required the disclosure of policy limits only after litigation was commenced.
However, it appears from the language of the statute that there are limits to this new mandate. Section 4 of the new law is written in such a way to allow the argument that the new law applies only to accidents that occurred after 10/1/19, and that the insurance company has to request the HIPAA waiver from the claimant in order for the disclosure requirement to apply.
The plaintiff’s bar is already attempting to address this language in the legislature. As written, subsection (4) is governed by subsection (1) which states that the insurance company “may require the claimant … to provide … a written authorization.” The following subparts all appear to be triggered only by the act of the insurance company requesting a HIPAA waiver. The plaintiff’s bar is pushing for clarifying language that would make it clear that once the claimant sent a HIPAA waiver, irrespective of whether the document was requested by the insurance company or not, the insurance company is required to disclose policy limits. This is not how the law reads on its face, and the change would make a significant difference from a practical perspective.
Under the current language, the insurance company will be able to argue that if the insurance company does not ask for a HIPAA waiver, the carrier isn’t required to disclose policy limits. Plaintiffs’ attorneys will surely disagree. A potential rebuttal any plaintiff’s argument inthis regard is that the plain language of the statute is unambiguous, and courts only look beyond the plain language of a statute where there is ambiguity. See Courts State Local Gov’t Employee-Management Rels. Bd. v. Educ. Support Emples. Ass’n, 429 P.3d 658, 661.
That said, if the insurance company does ask for a HIPAA authorization, the carrier will have 10 days to provide policy limits.
Additionally, the new law does not distinguish claims where there is an issue of coverage or if coverage is still being verified/confirmed. It simply mandates if the insurance company requests a “written authorization” which allows the carrier to obtain “all medical reports, records and bills” undertaken to date, then the insurance carrier will need to disclose its limits even if there is a coverage issue or if coverage is not yet determined.
2) Second, and as interesting, a claimant can now void a release under one specific scenario: the release is signed within 30 days after the injury-event and the claimant was unrepresented. An easy way to avoid this situation is to tell the adjusters not to accept an executed release until the 31st day after the event. They can settle, but avoid the exchange.
Each of these changes will effect initial claims handling and both changes should be reviewed and understood. Bremer Whyte is also available to consult with on either of these points.