(1)

1. (a) Unless otherwise provided by law, an insurer shall timely pay every valid insurance claim made by an insured.

2. (b) By rule the commissioner may prescribe:

   1. (i) the kinds of notice and proof of loss that will establish validity;
   2. (ii) the manner in which an insurer may make a bona fide denial of a claim;
   3. (iii) the periods of time within which payment is required to be made to be timely; and
   4. (iv) the reasonable interest rates to be charged upon late claim payments.

(2)

1. (a) Notwithstanding Subsection (1) and subject to Subsection (2)(b), the payment of a claim is not overdue during any period in which:

   1. (i) the insurer is unable to pay the claim because there is no recipient legally able to give a valid release for the payment; or
   2. (ii) the insurer is unable to determine who is entitled to receive the payment.

2. (b) Subsection (2)(a) applies only if the insurer:

   1. (i) promptly notifies the claimant of the inability to pay the claim; and
   2. (ii) offers in good faith to pay the claim promptly when the inability to pay the claim is removed.

(3) This section applies only to a claim for first party benefits made by a person who is:

1. (a) named or defined as an insured under the terms of an insurance policy;
2. (b) described as a covered person under the terms of a policy of health care insurance as defined in Section 31A-1-301; or

3. (c) named, defined, or described:

   1. (i) as:

      1. (A) an insured;
      2. (B) a beneficiary;
      3. (C) a policyholder; or
      4. (D) otherwise covered person; and

   2. (ii) under the terms of:

      1. (A) a life insurance policy; or
      2. (B) an annuity.