2023 Colorado Revised Statutes › Title 10 - INSURANCE (§§ 10-1-101 — 10-23-110) › PROPERTY AND CASUALTY INSURANCE (§§ 10-4-101 — 10-4-1909) › Article 4 - PROPERTY AND CASUALTY INSURANCE (§§ 10-4-101 — 10-4-1909) › Part 4 - RATE REGULATION (§§ 10-4-401 — 10-4-421) › Section 10-4-419 - Claims-made policy forms

(1)
No insurer shall use or issue any policy, certificate, or contract of insurance or any portion thereof which provides coverage on a claims-made basis unless it has been certified by the insurer and the insurer has filed a certification with the commissioner that such policy endorsement or disclosure form or any portion thereof which provides coverage on a claims-made basis conforms to Colorado law pursuant to subsection (2) of this section and any rules and regulations promulgated pursuant to subsection (3) of this section.
(2)
A claims-made policy shall not be delivered or issued for delivery to any person in this state unless:
(a)
The insurer defines the nature of the risks or exposures to be insured on the claims-made policy;
(b)
(I)
The policy contains clear and adequate disclosure and alerts the insured to the fact that the policy is a claims-made policy and explains the unique features distinguishing it from an occurrence policy and relating to renewal, extended reporting periods, and coverage of occurrences with long periods of exposure. The commissioner shall promulgate regulations which establish proof of delivery and acceptance thereof by the policyholder and set forth the contents and format of the minimum disclosures required under this article.
(II)
Such disclosures shall include:
(A)
A description of the principal benefits and coverage provided in the policy;
(B)
A statement of the exceptions, reductions, and limitations contained in the policy;
(C)
A statement of the renewal provisions including any reservation by the insurer of a right to change premiums;
(D)
A statement that the outline of coverage is a summary of the policy issued or applied for and that the policy should be consulted to determine governing contractual provisions.
(c)
The policy clearly defines the events and conditions which trigger coverage and defines when and how a claim is deemed to be made or is deemed made;
(d)
The policy offers, at the insured's option, the purchase of an extended reporting period of at least one year for claims not filed during the policy period. The premium may not exceed two hundred percent of the expiring policy premium unless the adjusted premium is determined by the commissioner to be inadequate based upon section
10-4-403
and based upon an opinion of a qualified actuary submitted on behalf of the insurer.
(e)
The policy requires insurers to furnish policyholders, upon their request and within thirty days thereafter, sufficient information about closed or paid claims, claims for which the company has established reserves, and claims for which the company has received notices of occurrences which could give rise to claims to allow the insured to determine how much of his aggregate coverage remains available under the policy;
(f)
The insured approves and acknowledges, by signature on the written endorsement, any exclusionary endorsement which excludes coverage in a renewal period for claims from certain known occurrences, events, products, or locations;
(g)
All persons engaged in the sale, consultation, or adjustment of the claims-made policy have been trained and certified pursuant to the standards and procedures set forth in regulations promulgated by the commissioner.
(3)
(a)
The commissioner may prohibit the use of a claims-made liability policy if the policy does not contain one or more of the following policy provisions:
(I)
(Deleted by amendment, L. 2000, p. 466, § 5, effective August 2, 2000.)
(II)
A policy provision that, in the event of cancellation or nonrenewal for any reason, the policy guarantees the insured the right of a sixty-day period to purchase coverage for an extended reporting period as provided in subparagraph (III) of this paragraph (a); or
(III)
A policy provision that, at the insured's option, the insured may purchase coverage for an extended reporting period of at least the length of time of exposure under the applicable statute of limitation.
(IV)
(Deleted by amendment, L. 2000, p. 466, § 5, effective August 2, 2000.)
(b)
(Deleted by amendment, L. 2000, p. 466, § 5, effective August 2, 2000.)
(4)
If a standardized claims-made policy form, proposed by a rating or advisory organization, has been filed with the commissioner and certified by the rating or advisory organization to be in compliance with statutory mandates, an insurer may utilize such a form.
(5)
As used in this section, unless the context otherwise requires, "claims-made policy" means a policy of liability insurance that provides coverage for those claims that are made or reported to the insurance carrier, as is required in the policy, during the term of the policy or for such extended reporting term for which coverage has been purchased. A "claims-made policy" may include coverage for events occurring before the current policy term.
(6)
This section shall not apply to any public entity self-insurance pool formed pursuant to section
24-10-115.5
, C.R.S., or to any policy, certificate, or contract of insurance offered or issued by an insurer to such a pool.
(6.5)
This section shall not apply to insurers providing coverage for exempt commercial policyholders, as defined pursuant to section
10-4-1402
and rules adopted by the commissioner pursuant to that section.
(7)
All insurers providing insurance on a claims-made basis and who are authorized by the commissioner to conduct business in Colorado shall submit an annual report to the commissioner listing any policy form, endorsement, disclosure form, or any other evidence of coverage issued or delivered to any policyholder in Colorado. Such listing shall be submitted by July 15, 1993, and not later than July 1 of each subsequent year and shall contain a certification by an officer of the organization that each policy form, endorsement, or disclosure form in use complies with Colorado law. The necessary elements of the certification shall be determined by the commissioner.
(8)
All insurers providing insurance on a claims-made basis and who are authorized by the commissioner to conduct business in Colorado shall also submit to the commissioner a list of any new policy form, endorsement, or disclosure form at least thirty-one days before using such policy form, endorsement, or disclosure form. Such listing shall also contain a certification by an officer of the organization that each new policy form, endorsement, or disclosure form proposed to be used complies with Colorado law. The necessary elements of the certification shall be determined by the commissioner.
(9)
The commissioner shall have the power to examine and investigate insurers authorized to conduct business in Colorado to determine whether claims-made policy forms, endorsements, or disclosure forms comply with the certification of the insurer and statutory mandates.
L. 86: Entire section added, p. 581, § 6, effective July 1. L. 87: (2)(d) amended, p. 427, § 7, effective May 1. L. 92: (1), IP(2), IP(3)(a), and (4) amended and (7) to (9) added, p. 1558, § 59, effective May 20. L. 96: (2)(d) and (3)(a)(III) amended, p. 571, § 1, effective July 1. L. 99: (6.5) added, p. 388, § 7, effective 1/15/2000. L. 2000: (3) amended, p. 466, § 5, effective August 2.
For the legislative declaration contained in the 2000 act amending subsection (3), see section 1 of chapter 135, Session Laws of Colorado 2000.