MD Insurance Bulletin 07-15
Implementation of SB 389
Bulletin: Property and Casualty 07-15
To:
Property and Casualty Insurers and All Interested Parties
Re:
Implementation of SB 839 389
Date: September 28, 2007
The purpose of this Bulletin is:
• to identify the forms that must be completed and accompany the filing of a Section 27-1001
Civil Complaint with the Administration;
• identify the manner in which property and casualty insurers are to notify the Administration
of the person it has designated as its authorized representative to receive Section 27-1001
filings from the Administration; and
• to identify the new forms which property & casualty insurers must utilize in reporting
information to the Administration as required by Section 27-1001 of the Insurance Article and
COMAR 31.08.11.01 et seq..
I.
Background
Section 3-1707 of the Courts and Judicial Proceedings Article and Section 27-1001 of the
Insurance Article was enacted by Chapter 150, Acts 2007 and signed into law by Governor Martin
O’Malley. The new law becomes effective October 1, 2007.
This law authorizes the award of enhanced damages in civil actions that arise out of first party
property and casualty insurance claim disputes where the plaintiff proves that the insurer failed to act
in good faith.1 It also creates special procedures that must be followed for certain cases that allege
the absence of good faith and that seek those enhanced damages. Specifically, the law requires that a
1 In addition, the law makes the failure of a property and casualty insurer to settle a first party insurance claim in good
faith a violation of the Unfair Claim Settlement Practices Act and authorizes enhanced administrative santions for
violations. However, those changes are not addressed in this Bulletin.
RALPH S. TYLER
Commissioner
JAMES V. MCMAHAN, III
Deputy Commissioner
P. RANDI JOHNSON
Associate Commissioner
Property & Casualty
MARTIN O’MALLEY
Governor
ANTHONY G. BROWN
Lt. Governor
525 St. Paul Place, Baltimore, Maryland 21202-2272
Direct Dial: 410-468-2301 Fax: 410-468-2306
Email: prjohnson@mdinsurance.state.md.us
1-800-492-6116 TTY: 1-800-735-2258
www.mdinsurance.state.md.us
civil action stating a cause of action under Section 3-1701 of the Courts and Judicial Proceedings
Article must first be filed with the Administration.2
II.
Forms Required for the Filing of a Section 27-1001 Civil Complaint
For all civil actions filed under Section 27-1001 of the Insurance Article, the Plaintiff
shall complete and attach to the civil complaint a Civil Cover Sheet attached hereto as Exhibit 1.
This Civil Cover Sheet is available to everyone and it can be obtained by going to the
Administration’s website (www.mdinsurance.state.md.us), coming to the Administration’s offices
located at 525 St. Paul Place, Baltimore, Maryland 21202, and/or by mail at the request of the
Plaintiff.
III.
Manner in which Property and Casualty Insures are to Designate its 27-1001 Filing
Receiver
Each property and casualty insurer which issues, sells or delivers policies that include
first party coverage in the State shall designate a person authorized to receive 27-1001 Filings from
the Administration. Such designation, including the person’s name and address, shall be made either
electronically or by mail. The designation shall list each company (including its NAIC number) for
whom the person is acting as the designee. If the designation by the insurer is sent to the
Administration electronically, it should be emailed to:
appealsclerkcontacts@mdinsurance.state.md.us
If the insurer sends the designation by mail, it should be sent to:
Maryland Insurance Administration
27-1001 Appeals Clerk/Contacts
P.O. Box 388
Baltimore, Maryland 21203
Please recall that the failure of a property and casualty insurer to designate a person
authorized to receive 27-1001 Filings from the Administration will result in the 27-1001 Filings
being forwarded to the person previously identified by the insurer to receive process that has been
served on the Commissioner as attorney-in-fact.
IV.
Forms Required to be completed by Property and Casualty Insurers for 27-110
Filings and for 3-1701 Filings [Refer to 2008 Amended Filing Instructions]
Each property and casualty insurer that is served with a 27-1001 Filing that is initially filed with
the Administration and then becomes subject to further adjudication shall complete a Notice of
Disposition Form and submit it to the Administration within 30 days of the disposition by any
adjudicatory body with regard to the civil action. The Notice of Disposition Form is attached hereto
2 This requirement has certain exceptions. A complaint alleging an absence of good faith on the part of a property and
casualty insurer involving a first party insurance claim dispute does not have to be filed with the Administration if it is an
action that falls within the small claim jurisdiction of the District Court under §4-405 of the Courts and Judicial
Proceedings Article, if the insured and insurer agree to waive the requirement that the case first be filed with the
Administration, or if the claim is made under a commercial property and casualty insurance policy and the applicable
limit of liability exceeds $1,000,000.00.
as Exhibit 2 and is to be supplied to the Administration in an excel spread sheet format containing all
the listed information.3
Each property and casualty insurer that is served with a civil complaint that alleges an absence of
good faith and seeks enhanced damages under Section 3-1701 of the Courts and Judicial Proceedings
Article, but was not originally filed with the Administration shall file a Notice of Pending Complaint
and submit it to the Administration within 30 days of service of process. The Notice of Pending
Complaint is attached hereto as Exhibit 3 and is to be supplied to the Administration in an excel
spread sheet format containing all the required information.4
These forms, the Notice of Disposition and the Notice of Pending Complaint, are to be updated as
the civil action proceeds through each level of adjudication and as each adjudicatory body issues a
disposition.
Questions regarding the information provided in this Bulletin should be directed to Randi
Johnson, Associate Commissioner, Property and Casualty, by telephone at 410-468-2301 or by email
at prjohnson@mdinsurance.state.md.us. Questions regarding the insurers reporting of the Notice of
Disposition or Notice of Pending Complaint should be direct to Pam Hirsch, Management
Information Systems, by telephone at 410-468-2346 or by email at phirsch@mdinsurance.state.md.us
.
RALPH S. TYLER
Insurance Commissioner
By_________________________
P. Randi Johnson
Associate Commissioner
Property & Casualty
3 Currently, the Administration is requiring this information to be submitted in an excel spreadsheet; however, it is
looking into an “on line’ reporting method and will advise all property and casualty insurers when such an on line
reporting mechanism is available to them.
4 Id.
EXHIBIT 1
MARYLAND INSURANCE ADMINISTRATION
P.O. BOX 388, BALTIMORE, MD 21203
§ 27-1001 CIVIL COMPLAINT CASE INFORMATION COVER SHEET
INSTRUCTIONS
Pursuant to COMAR 31.08.11, plaintiffs who are required by §3-1701 of the Courts and Judicial
Proceedings Article and § 27-1001 of the Insurance Article to file a Complaint stating a cause of action that is subject
to § 3-1701 of the Courts and Judicial Proceedings Article with the Maryland Insurance Administration (MIA) in
advance of filing with the circuit court must complete this Civil Complaint Case Information Cover Sheet and submit it
to the MIA along with an original and two copies of the Complaint and attachments. In addition, the MIA requests,
but does not require, that plaintiffs submit the entire filing on a CD-ROM in PDF format.
§ 27-1001 Civil Complaint Filings must be sent to the MIA as follows:
(a)
via first class mail in an envelope clearly marked in the lower left hand corner "§ 27-1001 FILING"
addressed to the Appeals Clerk, Maryland Insurance Administration, Post Office Box 388,
Baltimore, Maryland 21203;
(b)
via a commercial overnight delivery service addressed to: § 27-1001 Appeals Clerk, Maryland
Insurance Administration, 525 St. Paul Place, Baltimore, Maryland 21202; or
(c)
via hand delivery between the hours of 8 a.m. and 4 p.m. to the Maryland Insurance Administration,
525 St. Paul Place, Baltimore, Maryland 21202 in an envelope clearly marked in the lower left hand
corner "§ 27-1001 FILING" and addressed to the Appeals Clerk.
PLEASE SUPPLY THE FOLLOWING INFORMATION
The name of each plaintiff:
The name, law firm name, mailing address, email address, and workday telephone number of counsel for the
plaintiff(s) or, if there is no counsel, for each plaintiff:
The name of each insurance company that is the subject of the complaint:
Is there a related civil action or an administrative complaint pending? If yes, please identify the case name and
number and the tribunal before which the related matter is pending:
PLEASE COMPLETE THE FOLLOWING SECTION
Comment:
Only certain claims under certain insurance policies are subject to filing with the MIA. This section
is intended to assure that your complaint is subject to filing with the MIA under § 3-1701 and that
the complaint includes the materials and the information required by § 27-1001. A complaint that
does not fall within the MIA's subject matter jurisdiction will be returned.
Check all that apply
The complaint seeks to determine:
the coverage that exists under an insurance policy;
how much the insured is entitled to receive as payment from the insurer for a covered loss; or
both.
The complaint arises out of a first-party insurance claim that was made under a policy of property and/or
casualty insurance that was issued, sold, or delivered in the State of Maryland.
The complaint alleges that the insurer failed to act in good faith.
The complaint seeks:
Actual damages in the amount of ______________;
Expenses and litigation costs in the amount of ______________;
Interest in the amount of __________________.
Note: You must provide this information under § 27-1001.
The complaint is not within the small claims jurisdiction of the District Court of Maryland; that is, the
complaint does not seek actual damages of $5,000 or less.
The insurer(s) and the insured(s) have not agreed to waive the submission of this complaint to the MIA.
The insurance claim at issue is not a claim under a policy of commercial insurance with respect to which the
applicable limit of liability exceeds $1 million.
The complaint is accompanied by each document that the insured has submitted to the insurer for proof of loss.
The complaint specifies the applicable insurance coverage.
In addition, please provide the following information regarding the insurance policy at issue:
Personal insurance
Commercial insurance
homeowners
general liability
fire and/or dwelling
auto
auto
professional
personal
excess/umbrella
property
inland marine
inland marine
other:
excess/umbrella
other:
Date: ____________________________
Signature_____________________________
EXHIBIT 2
27-1001 Notice of Disposition
Insurer Name &NAIC #:____________________
(a) What adjudicatory body which issued the disposition?
Select the following adjudicatory body:
Office of Administrative Hearings (OAH)
Circuit Court
District Court
Court of Special Appeals
Court of Appeals
Select the city/county in which your court is located?
Circuit Court
Allegany
Carroll
Harford
Somerset
Anne Arundel
Cecil
Howard
St. Mary’s
Baltimore City
Charles
Kent
Talbot
Baltimore
Dorchester
Montgomery
Washington
Calvert
Frederick
Prince George’s
Wicomico
Caroline
Garrett
Queen Anne’s
Worcester
District Court
Allegany
Carroll
Harford
Somerset
Anne Arundel
Cecil
Howard
St. Mary’s
Baltimore City
Charles
Kent
Talbot
Baltimore
Dorchester
Montgomery
Washington
Calvert
Frederick
Prince George’s
Wicomico
Caroline
Garrett
Queen Anne’s
Worcester
(b) The case name and number before that adjudicatory body, as well as the case name and number
of any underlying or prior dispositions with respect to that Complaint:
Case Name:
Court/Any underlying or prior
dispositions
List Names
Case Number:
Court/Any underlying or prior
dispositions
List Numbers
(c) Whether the Complaint sought a determination as to coverage and/or alleged a failure by the
Defendant Insurer to adequately value and/or pay the underlying insurance claim:
Please select:
Coverage
Value
Both coverage and value
(d) The type of coverage at issue in the Complaint, such AutoUM/UIM, Homeowner’s, Commercial
General Liability, etc.:
Please select:
Auto
Fire, Allied Lines & CMP
Private Passenger
Group Private Passenger
Commercial
Motorcycle
Motorhome/Recreational Vehicle
Motorsport
Rental
Other
Homeowners
Liability
Homeowners
Group Homeowners
Farm/Ranchowners
Mobile Homeowners
Condo/Town
Renters/Tenants
Other
Miscellaneous
Inland Marine
Watercraft
Aircraft
Fire & Allied Lines
Crop/Hail
Commercial Multi-Peril
Credit Property
Dwelling Fire
Builder's Risk
Other
General Liability
Products Liability
Professional Errors & Omissions
Umbrella
Directors & Officers
Other
(e) The amount sought as damages in the Complaint, itemized by:
(i) The amount sought as actual damages
Please enter amount $___________________ ; and
(ii) The amount sought as expenses and litigation costs, including attorney's fees:
Type
Amount
Expenses
$
Litigation Costs
$
Attorney Fees
$
(f) The disposition of each count of the Complaint:
List disposition:
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
(g) A summary of any determinations made:
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
(h) A listing of any amounts awarded by the adjudicatory body:
(i) The amount awarded as actual damages
Please enter amount $___________________ ; and
(ii) The amount awarded as expenses and litigation costs, including attorney's fees;
Type
Amount
Expenses
$
Litigation Costs
$
Attorney Fees
$
(i) Whether any further proceedings before that body or another tribunal have been filed or are
expected to be filed.
An appeal filed
Yes
No
If yes, where was the appeal filed
Circuit Court
Court of Special
Court of Appeals
EXHIBIT 3
3-1701 Notice of Pending Complaint
Insurer Name& NAIC #:____________________
(a) The court in which the Complaint was filed:
Circuit Court
District Court
Court of Special Appeals
Court of Appeals
Select the city/county in which your court is located?
Circuit Court
Allegany
Carroll
Harford
Somerset
Anne Arundel
Cecil
Howard
St. Mary’s
Baltimore City
Charles
Kent
Talbot
Baltimore
Dorchester
Montgomery
Washington
Calvert
Frederick
Prince George’s
Wicomico
Caroline
Garrett
Queen Anne’s
Worcester
District Court
Allegany
Carroll
Harford
Somerset
Anne Arundel
Cecil
Howard
St. Mary’s
Baltimore City
Charles
Kent
Talbot
Baltimore
Dorchester
Montgomery
Washington
Calvert
Frederick
Prince George’s
Wicomico
Caroline
Garrett
Queen Anne’s
Worcester
(b) The case name and number assigned to the Complaint:
Case Name __________________________________________
Case Number _________________________________________
(c) The parties to the Complaint:
List Parties and Designation (Name(s), Plaintiff and Name(s), Defendant):
_______________________________________________
_______________________________________________
_______________________________________________
_______________________________________________
_______________________________________________
(d) The reason why the Complaint was not required to be filed with the Administration prior to being
filed with the court:
Small Claim (not to exceed $5,000)
Either Party has waived the right the come to the MIA
Commercial claim where the applicable policy limits exceeds $1,000,000
(e) Whether the Complaint sought a determination as to coverage and/or alleged a failure by the
Defendant Insurer to adequately value and/or pay the underlying insurance claim:
Coverage
Value
Both coverage and value
(f) The type of coverage at issue in the Complaint, such AutoUM/UIM, Homeowner’s, Commercial
General Liability, etc.:
Please select:
Auto
Fire, Allied Lines & CMP
Private Passenger
Group Private Passenger
Commercial
Motorcycle
Motorhome/Recreational Vehicle
Motorsport
Rental
Other
Homeowners
Liability
Homeowners
Group Homeowners
Farm/Ranchowners
Mobile Homeowners
Condo/Town
Renters/Tenants
Other
Miscellaneous
Inland Marine
Watercraft
Aircraft
Fire & Allied Lines
Crop/Hail
Commercial Multi-Peril
Credit Property
Dwelling Fire
Builder's Risk
Other
General Liability
Products Liability
Professional Errors & Omissions
Umbrella
Directors & Officers
Other
(g) The amount sought as damages in the Complaint, itemized by:
(i) The amount sought as actual damages
Please enter amount $___________________ ; and
(ii) The amount sought as expenses and litigation costs, including attorney's fees.
Type
Amount
Expenses
$
Litigation Costs
$
Attorney Fees
$
(h) The disposition of each count of the Complaint:
List disposition:
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
(i) A summary of any determinations made:
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
______________________________________________________
(j) A listing of any amounts awarded by the adjudicatory body:
(i) The amount awarded as actual damages
Please enter amount $___________________ ; and
(ii) The amount awarded as expenses and litigation costs, including attorney's fees:
Type
Amount
Expenses
$
Litigation Costs
$
Attorney Fees
$
(k) Whether any further proceedings before that body or another tribunal have been filed or are
expected to be filed.
An appeal filed
Yes
No
If yes, where was the appeal filed
Circuit Court
Court of Special
Court of Appeals