Next up in our whirlwind 50-state tour of claims handling requirements is the Tar Heel State. Unlike our previous stops in New Jersey and Pennsylvania, North Carolina has relatively few explicit claims handling requirements. This may be why North Carolina ranked dead last in a 50-state ranking of insurance regulations as pointed out by my colleague, Nicole Vinson.
North Carolina General Statute § 58-63(11) requires that an insurance carrier act openly and honestly with insureds during the claim process. The North Carolina Statutes provide some specific acts that are compulsory or are barred. For instance, a carrier must acknowledge and act upon communications regarding claims reasonably promptly. N.C. Gen. Stat. § 58-63(11)(b). The insurance carrier must affirm or deny coverage of the claims within a reasonable time after the claimant provides a proof of loss. N.C. Gen. Stat. § 58-63(11)(e). The carrier must settle claims promptly after liablity has become reasonably clear. N.C. Gen. Stat. § 58-63(f). They must not attempt to settle a claim for less than what a reasonable man would believe was appropriate. N.C. Gen. Stat. § 58-63(11)(h). If a claim is denied, or a claim is partially paid as a result of a compromise settlement, the insurance carrier must also promptly provide a reasonable explanation for the denial or the offer of compromise. N.C. Gen. Stat. § 58-63(11)(n). Finally, once a decision has been made to pay a claim, the payment must be mailed or delivered within ten days. 11 N.C. Admin. Code 4.0421(1).
As you can see, the North Carolina statutes use terms like “reasonable” and “promptly,” which means that the facts are going to be considered. Accordingly, insureds in North Carolina need to stay on top of their insurance claims and respond as soon as possible to all communications from the insurance carrier. This will help to define what “reasonable” and “promptly” mean in that claim.
Finally, whenever I get to thinking about North Carolina, I inevitably turn to one of my favorite movies, Bull Durham. This might be one of the best scenes in a sports film: