31A-22-1101 - Combination of lines. - Utah Statutes

31A-22-1101. Combination of lines.
(1) Legal expense insurance may be transacted alone or together with life insurance,accident and health insurance, or casualty insurance.
(2) An insurer may not transact liability insurance and also issue legal expense insurancepolicies providing coverage for the expense of enforcing claims against third persons, unless therequirements of Subsection (3) are met and the commissioner is satisfied that the interests ofpolicyholders of legal expense insurance policies are not endangered by potential conflicts ofinterest within the insurer.
(3) Adequate precautions shall be taken to make sure that the handling of an insured'sclaim for legal assistance in enforcing a claim against a third person is not affected by theinsurer's actual or potential obligation as a liability insurer to pay the claim for the third person.These precautions may include:
(a) a provision in the policy that claims against third persons shall be handled exclusivelyby attorneys selected by the insureds themselves rather than by the insurer, that no informationabout the case other than the name of the defendant and the nature of the claim may be madeavailable to the insurer, and that the insurer may not interfere with the handling of the case; or
(b) organizational separation between the legal expense and the liability insurancedepartments with respect to management, accounting, record keeping, and claims handling, withappropriate rules and procedures, satisfactory to the commissioner, to prevent the exchange ofinformation between the two departments about details of cases.

Amended by Chapter 116, 2001 General Session