(1) The general assembly hereby finds, determines, and declares that:
(a) (I) Business practices that have the effect of reducing or eliminating the
need for actual payment of required copayments and deductibles by an insured for
property damages interfere with contractual obligations entered into by the insured
and insurer relating to such payments;
(II) Interference described in subparagraph (I) of this paragraph (a) is not in
the public interest because it has the effect of increasing insurance costs by
removing the incentives that copayments and deductibles create in making the
consumer a cost-conscious purchaser; and
(b) (I) Business practices that have the effect of providing rebates or
something of value to an insured to attract business relating to property damages
when the costs of the rebate or thing of value is passed on to an insurer interfere
with contractual obligations entered into by the insured and insurer relating to such
property damages;
(II) Interference described in subparagraph (I) of this paragraph (b) is not in
the public interest because it has the effect of increasing insurance costs by
including items unrelated to the property damage in the costs paid by insurers; and
(c) Advertising of practices described in paragraphs (a) and (b) of this
subsection (1) may aggravate the impact of such practices.
(2) (a) The general assembly further declares that business practices
described in subsection (1) of this section are illegal and that such practices or the
advertising thereof shall be grounds for disciplinary actions by any governmental
body which is responsible for licensing or regulating persons who engage in such
practices.
(b) The general assembly further declares that this section shall create a
private right of action in courts of the state of Colorado, including an action for
injunctive relief.
(3) Any person who provides repairs, goods, or services commits abuse of
property insurance if such person knowingly:
(a) Submits a fee to an insurer which is higher than a fee estimate such
person provided to the insured or which is higher than the fee such person has
agreed to accept from the insured if the effect is to provide the insured a rebate or
something of value to attract the insured to do business with such person and the
cost of providing the rebate or thing of value is passed on to the insurer as a part of
the higher fee; or
(b) Provides a rebate or a gift, cash, or thing of value to an insurance
company or its representative, agent, employee, or others acting on behalf of the
insurance company, in connection with any claim under an insurance policy which
insures for property damage.
(4) Any insurance company, or its agent, employee, representative, or other
person acting on behalf of the insurance company, commits abuse of property
insurance if such company or person knowingly: Accepts a rebate or a gift, cash, or
thing of value from any person who provides repairs, goods, or services in
connection with any claim under an insurance policy which insures for property
damage.
(5) Abuse of property insurance is a petty offense.
L. 92: Entire section added, p. 409, § 1, effective July 1. L. 96: (2)(b) amended, p. 1846, § 17, effective July 1. L. 2021: (5) amended, (SB 21-271), ch. 462, p. 3216, § 370, effective March 1, 2022.
