Speeding up insurance claims

Let’s say you own a store and a fire destroys the building and your inventory. You have insurance, but you may find you have to hire a lawyer to get them to pay up.

“So despite the fact you’ve paid all this money for insurance premiums, you’ve got about half of what you should have had if the insurance would have paid out immediately,” said Rep. Joe Atkins (DFL-Inver Grove Heights).

He sponsors HF417 that would allow for a 12 percent interest charge on the insurance proceeds calculated from the time the insured requests payment of the policy amount, plus reasonable attorney fees and court costs.

“Right now the cards are stacked in favor of the insurance company and this just tries to make folks whole and put them on a little more level footing,” Atkins said.

The bill was passed 75-56 by the House April 16. It now moves to the Senate, where Sen. Tom Bakk (DFL-Cook) is its sponsor.

Opponents say the legislation would increase insurance litigation costs, and in turn, increase insurance payments. Some say the bill goes beyond similar regulations in other states.

Several amendments were defeated on the House floor that proposed to cap attorneys’ fees at $30,000 and award anything above that amount to organizations such as the Legal Aid Society. Rep. Tom Emmer (R-Delano) said attorneys ought to be able to do the job for that amount.

Rep. Jim Abeler (R-Anoka) was successful with his amendment that, among other things, specifies that no entity administering an insurance plan shall require a patient to pay for care provided by an in-network provider in an amount that exceeds the fee negotiated for the covered service between the entity and that provider.