Currently, consumers are barred from recovering punitive damages or legal costs when they sue a foot-dragging insurer. The legislation will be formally introduced within a week, said Rep. Jack Minore, D-Flint.
Passage is another matter.
Earlier attempts to punish insurers that don't pay claims fairly have failed decisively in Lansing. Minore, one of five Democratic sponsors, acknowledged the obstacles. But he noted the testimony of policyholders last summer who told lawmakers of the anguish and financial hardship they suffered in attempting to recover on claims. He said the bills are based on the false premise that consumers are not happy with the way claims are handled. Cruce also noted that state regulators can revoke a company's license or impose fines if customers are abused.