38.2-3407.1 - Interest on accident and sickness claim proceeds.
§ 38.2-3407.1. Interest on accident and sickness claim proceeds.
A. If an action to recover the claim proceeds due under an individual orgroup accident and sickness policy results in a judgment against an insurer,interest on the judgment at the legal rate of interest shall be paid from thedate of presentation to the insurer of proof of loss to the date judgment isentered.
B. If no action is brought, interest upon the claim proceeds paid to thepolicyholder, insured, claimant, or assignee entitled thereto shall becomputed daily at the legal rate of interest from the date of fifteen workingdays from the insurer's receipt of proof of loss to the date of claim payment.
C. This section shall not apply to individual policies issued prior to July1, 1990, but shall apply to any renewals or reissues of group accident andsickness policies occurring after that date.
D. This section shall not apply to claims for which payment has been or willbe made directly to health care providers pursuant to a negotiatedreimbursement arrangement requiring uniform or periodic interim payments tobe applied against the insurer's obligation on such claims.
E. For purposes of this section, "proof of loss" means all necessarydocumentation reasonably required by the insurer to make a determination ofbenefit coverage.
F. This section shall not apply to claims proceeds payable to an out-of-stateprovider of pharmacy services for pharmacy services rendered outside of theCommonwealth. Notwithstanding the foregoing sentence, this section shallapply to claims proceeds payable to such an out-of-state provider if thestate where such services are rendered fails to provide for the payment ofinterest on the claims proceeds. If this section is applicable to claimsproceeds payable to such an out-of-state provider as a result of the failureof such other state to provide for the payment of interest on the claimsproceeds, then, notwithstanding the provisions of subsection B, interest uponthe claim proceeds paid to the policyholder, insured, claimant, or assigneeentitled thereto shall be computed daily at the legal rate of interest fromthe thirtieth day following the insurer's receipt of proof of loss to thedate of claim payment.
(1990, c. 531; 1992, c. 23; 1996, c. 75; 2009, c. 226.)