CO Code § 10-4-110.8 (2021)
2021 Colorado Code|Title 10 - Insurance|Article 4 - Property and Casualty Insurance|Part 1 - General|§ 10-4-110.8. Homeowner's Insurance - Prohibited and Required Practices - Estimates of Replacement Value - Additional Living Expense Coverage - Copies of Policies - Personal Property Contents Coverage - Inventory of Personal Property - Definitions - Rules

  An insurer may not cancel or fail to renew coverage of an insured solely because the insured inquires about coverage for homeowner's insurance and the inquiry is not related to an actual claim to the property insured.    An insurer may only provide information regarding claims to an entity that compiles or monitors personal claim or loss experience shared by insurers for underwriting or rating purposes.    For the purposes of this section, unless the context otherwise requires:   “Additional living expense coverage” or “ALE” covers increased living expenses during the time required to repair or replace damage to the policyholder's dwelling unit following an insured loss or, if the policyholder permanently relocates, the time required to move the policyholder's household to a new location.    “Claim” includes a demand for payment of a benefit by the insured, the payment of a covered benefit by an insurer, a loss reserve established by the insurer, a loss adjustment expense incurred by the insurer, or a payment made to the insured.    “Dwelling” means a single-family home, other than a mobile home, condominium, or manufactured home, that is used as a primary residence by the owner of the dwelling.    “Extended replacement cost coverage” pays a designated amount above the policy limit to replace a damaged structure if necessary under current building conditions.    “Inquiry” means a request for information regarding the terms, conditions, or coverages afforded under an insurance contract.    “Law and ordinance coverage” means coverage for increased costs of demolition, construction, renovation, or repair associated with the enforcement of building ordinances and laws.    “Recoverable depreciation” means the difference between the cost to replace insured property and the actual cash value of the property.       Every insurer issuing a policy of homeowner's insurance shall comply with section 10-3-1104 (1)(h) and all other provisions of part 11 of article 3 of this title.      In a common interest community, as defined in section 38-33.3-103 (8), C.R.S., a unit owner may file a claim against the policy of the unit owner's association to the same extent, and with the same effect, as if the unit owner were a named insured if the following conditions are met:   The unit owner has contacted the executive board or the association's managing agent in writing, and in accordance with any applicable association policies or procedures for owner-initiated insurance claims, regarding the subject matter of the claim;    The unit owner has given the association at least fifteen days to respond in writing, and, if so requested, has given the association's agent a reasonable opportunity to inspect the damage; and    The subject matter of the claim falls within the association's insurance responsibilities.       The association's insurer, when determining premiums to be charged to the association, shall not take into account any request by a unit owner for a clarification of coverage.         .    All homeowner's insurance replacement cost policies for a dwelling must include additional living expense coverage. This coverage must be available for a period of at least twelve months and is subject to other policy provisions. Insurers shall offer policyholders the opportunity to purchase a total of twenty-four months of ALE coverage and give an applicant an explanation of the purpose, terms, and cost of this coverage. This paragraph (b) does not apply to any homeowner's insurance policy that already includes at least twenty-four months of ALE coverage as a standard provision.         The text of all endorsements, summary disclosure forms, and homeowner's insurance policies must not exceed the tenth-grade reading level, as measured by the Flesch-Kincaid grade level formula, or must not score less than fifty as measured by the Flesch reading ease formula. Insurers shall revise all homeowner's insurance policies issued or renewed in Colorado on or after January 1, 2015, to comply with this subsection (7). Thereafter, all homeowner's insurance policies must comply with this subsection (7).    For the purposes of this subsection (7):   A contraction, hyphenated word, or numbers and letters, when separated by spaces, count as one word;    A unit of words ending with a period, semicolon, or colon, but excluding headings and captions, count as a sentence; and    A syllable means a unit of spoken language consisting of one or more letters of a word as divided by an accepted dictionary. If the dictionary shows two or more equally acceptable pronunciations of a word, a pronunciation containing fewer syllables may be used.    “Text” includes all printed matter except the following:   The name and address of the insurer; the name, number, or title of the policy; the table of contents or index; captions and subcaptions; and specification pages, schedules, or tables; and    Any policy language that is drafted to conform to the requirements of a federal law or regulation; any policy language required by a collectively bargained agreement; any medical terminology; any words that are defined in the policy; and any policy language required by law or regulation if the insurer identifies the language or terminology excepted and certifies in writing that the language or terminology is entitled to be excepted.             The insurer must consider, subject to the insurer's underwriting requirements, an estimate from a licensed contractor or licensed architect submitted by the policyholder as the basis for establishing the replacement cost of a dwelling.    At renewal of a homeowner's insurance policy, the insurer shall provide written notification to the policyholder describing changes in insurance policy language that are applicable to that renewal period.    Every homeowner's insurance carrier shall make available to a policyholder an electronic or paper copy of the policyholder's insurance policy, including the declaration page and any endorsements, within three business days after a request from the policyholder. The policyholder shall determine the method of delivery. Every homeowner's insurance carrier shall make available to a policyholder a certified copy of the policyholder's insurance policy within thirty days after a request from the policyholder.      and submit a written inventory as required by the insurer.    If the policyholder receives the depreciated value of contents insured under a policy, the insurer must make available to the insured the methodology used for determining the depreciated value of the insured contents.      An insurer shall allow the policyholder at least three hundred sixty-five days after a total loss claim to submit an inventory of lost or damaged property. (c) (I) An insurer shall allow the policyholder at least three hundred sixty-five days after a total loss claim to submit an inventory of lost or damaged property.    An insurer shall allow the policyholder at least three hundred sixty-five days after expiration of ALE to replace property and receive recoverable depreciation on that property.            :   Does not revive a cause of action that, as of May 10, 2013, has already been barred by contract; and    Applies only to a cause of action that, as of May 10, 2013, has not been barred by contract.       On and after January 1, 2014, an insurer shall not issue or renew a homeowner's insurance policy that requires the policyholder to file suit against the insurer, in the case of any dispute, within a period of time that is shorter than required by the applicable statute of limitations provided by law.        History. Source: L. 2004: Entire section added, p. 1972, § 3, effective August 4; entire section added, p. 1981, § 2, effective January 1, 2005. L. 2005: (3) and (4) amended and (5) added, p. 1390, § 20, effective January 1, 2006. L. 2006: (5) amended, p. 1226, § 16, effective May 26. L. 2013: (12) added,(HB 13-1225), ch. 183, p. 672, § 2, effective May 10; (3) amended and (6) to (11) added,(HB 13-1225), ch. 183, p. 672, § 2, effective January 1, 2014.    Cross references:   In 2013, subsection (3) was amended and subsections (6) to (12) were added by the “Homeowner's Insurance Reform Act of 2013”. For the short title, see section 1 of chapter 183, Session Laws of Colorado 2013.   ANNOTATION   Subsection (12)'s applicability to expired insurance policies does not violate the prohibitions on ex post facto laws and laws impairing the obligations of contracts. Schniedwind v. Am. Family Mut. Ins. Co., 157 F. Supp. 3d 944 (D. Colo. 2016 ).   Homeowner's insurance policy's one-year time period for lawsuits is not a vested contract right that could not constitutionally be abrogated. Because limitations periods are inherently the province of the legislature, an insurance company cannot claim a vested right to its ability to contractually shorten the applicable limitations period. Because the company's contractual expectation relied on the continued validity of common law in an area within traditional legislative power, the company has no vested right in the policy's contractual limitations period. Schniedwind v. Am. Family Mut. Ins. Co., 157 F. Supp. 3d 944 (D. Colo. 2016 ).   Retroactive application of subsection (12) to the contractual limitations clause in a homeowner's insurance policy, where homeowner's cause of action had not been contractually barred by May 10, 2013, does not violate the contract clause of either the state or federal constitution. Schniedwind v. Am. Family Mut. Ins. Co., 157 F. Supp. 3d 944 (D. Colo. 2016 ).   Subsection (12) serves a legitimate public purpose. A legitimate public purpose can be discerned from the statute itself, namely, concern that the rights of homeowners were not sufficiently safeguarded by allowing homeowner's insurance policies to specify a shorter limitations period than that prescribed by state law. The legislature is entitled to deference concerning the necessity and reasonableness of subsection (12), and subsection (12) is based upon reasonable conditions and is of a character appropriate to the public purpose justifying the legislation's adoption. Schniedwind v. Am. Family Mut. Ins. Co., 157 F. Supp. 3d 944 (D. Colo. 2016 ).   Paragraphs (a) and (b) of subsection (12) are complementary, not independent. Paragraph (a) is directed at homeowners, giving them immediate relief from shortened contractual limitations periods so long as the cause of action had not yet expired under the terms of the relevant policy. Paragraph (b) is directed at insurers, giving them time to remove shortened limitations periods from their policy templates. Paragraph (b) then prohibits the inclusion of such limitations periods, likely to prevent insurance companies from continuing to include such provisions as a deceptive means of discouraging policyholders from suing. Brookshire Downs at Heatherridge Condo. Ass'n v. Owners Ins. Co., 324 F. Supp. 3d 1201 (D. Colo. 2018 ).   “[P]olicyholder” and “homeowner” are used synonymously throughout subsection (12). “[P]olicyholder” is a synonym for “homeowner holding a homeowner's policy”. Brookshire Downs at Heatherridge Condo. Ass'n v. Owners Ins. Co., 324 F. Supp. 3d 1201 (D. Colo. 2018 ).   Subsection (12) creates an exception for homeowner's insurance policies to the general rule that contractually shortened limitations on lawsuits are enforceable under state law. Schniedwind v. Am. Family Mut. Ins. Co., 157 F. Supp. 3d 944 (D. Colo. 2016 ).   Breach of contract and statutory bad faith claims are not barred by homeowner's insurance policy's one-year limit on bringing suit. Schniedwind v. Am. Family Mut. Ins. Co., 157 F. Supp. 3d 944 (D. Colo. 2016 ).   Subsection (12) allows a homeowner to file suit within the statutory period, despite a shorter contractual limitation in the insurance policy, so long as the homeowner's cause of action was not barred by contract as of May 10, 2013. Schniedwind v. Am. Family Mut. Ins. Co., 157 F. Supp. 3d 944 (D. Colo. 2016 ).   The language of subsection (12)(a) confirms that the legislature intended that the statute apply retroactively. In clarifying that subsection (12) did not revive any cause of action already barred by contract and that it applies only to causes of action not barred by contract as of May 10, 2013, the legislature intended that the statute apply to homeowner's insurance policies that predated the Homeowner's Insurance Reform Act of 2013, but whose contractual limitations period had not yet expired. Schniedwind v. Am. Family Mut. Ins. Co., 157 F. Supp. 3d 944 (D. Colo. 2016 ).   Subsection (12) applies to “any provision” of a homeowner's insurance policy that shortens the otherwise-applicable statute of limitations, with the exception of a cause of action already contractually barred as of May 10, 2013. The fact that the statute makes no distinction between policies still in existence as of May 10, 2013, and policies that expired before that date does not exempt expired policies from the statute. Rather, the statute focuses on causes of action. The plain text of the statute provides that any cause of action not contractually barred by May 10, 2013, is subject to the statutory limitations period, while any cause of action that had been barred by contract as of that date is not revived. Schniedwind v. Am. Family Mut. Ins. Co., 157 F. Supp. 3d 944 (D. Colo. 2016 ).   Since homeowner suffered a loss on June 26, 2012, less than one year before May 10, 2013, the policy's one-year limitations period had not barred her cause of action as of the statute's effective date. As a result, subsection (12)(a) gives homeowner the right to file a claim against the insurer within the applicable statute of limitations, notwithstanding any provision of the homeowner's insurance policy to the contrary. Schniedwind v. Am. Family Mut. Ins. Co., 157 F. Supp. 3d 944 (D. Colo. 2016 ).