On May 10, 2013, Governor Hickenlooper ended the ability of insurers to shorten the statute of limitations through provisions in contracts with their policyholders. The bill Governor Hickenlooper signed made changes to Colorado Revised Statute Section 10-4-110.8, now entitled 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. Although most of the changes to the statute take effect on January 1, 2014, one of the changes, stopping insurers shortening the statute of limitations through language in its contract of insurance, was effective on the date Governor Hickenlooper signed the bill, May 10, 2013.

The statutory language added to Colorado Revised Statute Section 10-4-110.8 that disallows insurers from shortening the statute of limitations is contained in paragraph 12 of the statute and states:

(12)(a) Notwithstanding any provision of 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, a homeowner may file such a suit within the period of time allowed by the applicable statute of limitations; except that this paragraph (a):

(I) Does not revive a cause of action that, as of the effective date of this subsection (12), has already been barred by contract; and

(II) Applies only to a cause of action that, as of the effective date of this subsection (12), has not been barred by contract.

(b) 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.

The above statute will not help a policyholder in which the shortened contractual statute of limitations period barred a lawsuit prior to May 10, 2013, but if the shortened contractual statute of limitations period had not time barred a policyholder’s claim prior to May 10, 2013, then the 3-year statute of limitations period regarding breach of contract claims would apply.

I say bravo to the Colorado State Legislature and to Governor Hickenlooper for protecting victims who are seeking to be made whole due to events that have occurred for which they have insured themselves. Insurers should never have been able to bury a provision within a contract that would shorten a statute of limitations. This statute brings consistency to our state as now every contract action must be brought within 3 years, not some arbitrary time period chosen by an insurance company.

  • shirley heflin

    Dear Attorney Furtado:

    I had to read your post twice to ensure I understood what I was reading, to wit:

    “…Insurers should never have been able to bury a provision within a contract that would shorten a statute of limitations…”

    I’m stunned that an insurance company in Colorado could mandate, prescribe, govern, shorten, etc., the statute of limitations on any action regardless of what their insurance policy (“contract”) says. That’s akin to saying “well, the LAW is this BUT our policy says this and our policy is superior to the laws of this state.”

    In any event, it’s great news to read that this is not the case in CO any more!

    SHIRLEY HEFLIN
    (Tampa, FL)

  • Chip Merlin

    I say “Bravo” too!!