Opinion ID: 2454415
Heading Depth: 1
Heading Rank: 2

Heading: Penalty and attorney's fee

Text: For its second allegation of error, State Farm asserts that the trial court erred in awarding a penalty and attorney's fee on the underinsured portion of the judgment, which is an extension of State Farm's first point on appeal. Arkansas Code Annotated § 23-89-208(f) provides for payment of a penalty and attorneys' fees when the insurer is ordered to pay overdue benefits: In the event the insurer is required to pay the overdue benefits, the insurer shall, in addition to the benefits received, be required to pay the reasonable attorneys' fees incurred by the other party, plus twelve percent (12%) penalty, plus interest thereon from the date these sums become overdue. As the penalty and attorney's fees were calculated on the basis of both uninsured and underinsured coverage, we remand so that the 12 percent penalty and attorney's fees can be recalculated commensurate with the recovery of uninsured benefits only.