Section 27-304 - Unfair claim settlement practices - General business practiceIt is an unfair claim settlement practice and a violation of this subtitle for an insurer, nonprofit health service plan, or health maintenance organization, when committed with the frequency to indicate a general business practice, to:
(1) misrepresent pertinent facts or policy provisions that relate to the claim or coverage at issue;(2) fail to acknowledge and act with reasonable promptness on communications about claims that arise under policies;(3) fail to adopt and implement reasonable standards for the prompt investigation of claims that arise under policies;(4) refuse to pay a claim without conducting a reasonable investigation based on all available information;(5) fail to affirm or deny coverage of claims within a reasonable time after proof of loss statements have been completed;(6) fail to make a prompt, fair, and equitable good faith attempt, to settle claims for which liability has become reasonably clear;(7) compel insureds to institute litigation to recover amounts due under policies by offering substantially less than the amounts ultimately recovered in actions brought by the insureds;(8) attempt to settle a claim for less than the amount to which a reasonable person would expect to be entitled after studying written or printed advertising material accompanying, or made part of, an application;(9) attempt to settle a claim based on an application that is altered without notice to, or the knowledge or consent of, the insured;(10) fail to include with each claim paid to an insured or beneficiary a statement of the coverage under which the payment is being made;(11) make known to insureds or claimants a policy of appealing from arbitration awards in order to compel insureds or claimants to accept a settlement or compromise less than the amount awarded in arbitration;(12) delay an investigation or payment of a claim by requiring a claimant or a claimant's licensed health care provider to submit a preliminary claim report and subsequently to submit formal proof of loss forms that contain substantially the same information;(13) fail to settle a claim promptly whenever liability is reasonably clear under one part of a policy, in order to influence settlements under other parts of the policy;(14) fail to provide promptly a reasonable explanation of the basis for denial of a claim or the offer of a compromise settlement;(15) refuse to pay a claim for an arbitrary or capricious reason based on all available information;(16) fail to meet the requirements of Title 15, Subtitle 10B of this article for preauthorization for a health care service;(17) fail to comply with the provisions of Title 15, Subtitle 10A of this article; or(18) fail to act in good faith, as defined under § 27-1001 of this title, in settling a first-party claim under a policy of property and casualty insurance.Amended by 2014 Md. Laws, Ch. 355,Sec. 2, eff. 6/1/2014.