NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902)
The NAIC model act and model regulation that define unfair claims settlement practices for United States insurers: the general-business-practice test, the fourteen enumerated practices (misrepresentation, slow acknowledgement, no investigation standards, bad-faith settlement, low-ball offers that force suits, unexplained denials, unidentified payments, duplicate proofs, late forms, unsupervised required repairers), and the property and casualty regulation's documentation, disclosure, acknowledgement, decision, delay-letter, payment, limitation-notice, automobile total loss, repair, subrogation, storage, crash parts, replacement cost matching and actual cash value rules.
NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902) is a compliance framework from United States (model for State adoption) with 6 domains and 18 controls. The largest domains are Model Act sections 3 and 4: the general business practice test and the fourteen defined unfair claims practices – NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902) (5 controls), Model Regulation section 8: automobile insurance total loss, repair, subrogation, storage and crash parts – NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902) (4 controls), Model Regulation sections 5 and 6: misrepresentation of policy provisions and acknowledgement of communications – NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902) (3 controls). Every control below carries what it requires and what an assessor expects to see.
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Framework Domains (6)
Model Act sections 3 and 4: the general business practice test and the fourteen defined unfair claims practices – NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902)
| Code | Title |
|---|---|
| naic-unfair-claims-settlement-practices-model-act-mdl-900-and-model-regulation-mdl-902::mdl900-s3-general-business-practice | An unfair claims practice is actionable when committed flagrantly in conscious disregard of the law, or so often as to show a general business practice |
| naic-unfair-claims-settlement-practices-model-act-mdl-900-and-model-regulation-mdl-902::mdl900-s4-a-l-no-misrepresentation-explanation | Do not misrepresent facts or policy provisions, and give prompt reasonable and accurate explanations of denials and compromise offers |
| naic-unfair-claims-settlement-practices-model-act-mdl-900-and-model-regulation-mdl-902::mdl900-s4-b-c-f-g-acknowledge-standards-investigate | Acknowledge communications promptly, adopt standards for prompt investigation and settlement, investigate before refusing, and affirm or deny coverage within a reasonable time |
| naic-unfair-claims-settlement-practices-model-act-mdl-900-and-model-regulation-mdl-902::mdl900-s4-d-e-good-faith-settlement-no-lowball | Attempt in good faith to settle promptly, fairly and equitably once liability is reasonably clear, and never force suits by offering far less than the claim is worth |
| naic-unfair-claims-settlement-practices-model-act-mdl-900-and-model-regulation-mdl-902::mdl900-s4-h-i-j-k-m-n-settlement-basis-payments-forms-repairs | Settle on the advertised and applied-for terms, identify the coverage for each payment, avoid duplicate proofs, supply claim forms within fifteen days and stand behind required repairers |
Model Regulation section 7: standards for prompt, fair and equitable settlement applicable to all insurers – NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902)
| Code | Title |
|---|---|
| naic-unfair-claims-settlement-practices-model-act-mdl-900-and-model-regulation-mdl-902::mdl902-s7a-b-accept-deny-21-days | Accept or deny a first party claim within twenty-one days of proof of loss, deny in writing citing the provision, and send delay letters every forty-five days |
| naic-unfair-claims-settlement-practices-model-act-mdl-900-and-model-regulation-mdl-902::mdl902-s7c-h-no-shifting-sol-notice-payment-30-days | Do not shift payment to others, warn unrepresented claimants of limitation periods, do not pressure third parties with release deadlines, pay undisputed amounts within thirty days, no polygraphs without authority, and tell rejected claimants about the department |
Model Regulation section 8: automobile insurance total loss, repair, subrogation, storage and crash parts – NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902)
| Code | Title |
|---|---|
| naic-unfair-claims-settlement-practices-model-act-mdl-900-and-model-regulation-mdl-902::mdl902-s8a-total-loss-methods | Settle first party automobile total losses by a comparable replacement vehicle or a cash settlement derived from an approved valuation method, with a thirty-five-day right of recourse |
| naic-unfair-claims-settlement-practices-model-act-mdl-900-and-model-regulation-mdl-902::mdl902-s8b-d-third-party-travel-subrogation | Do not steer third party claimants to their own policies, do not require unreasonable travel, and share subrogation recoveries including the deductible proportionately |
| naic-unfair-claims-settlement-practices-model-act-mdl-900-and-model-regulation-mdl-902::mdl902-s8e-g-repairs-estimates | Give the insured the repair estimate, pay the difference or name a shop that will repair for the estimate, document betterment deductions, and restore the vehicle when the insurer designates the shop |
| naic-unfair-claims-settlement-practices-model-act-mdl-900-and-model-regulation-mdl-902::mdl902-s8h-j-storage-towing-betterment-crash-parts | Give notice before ending storage payments, pay reasonable towing, limit betterment deductions to measurable and documented items, and require identified crash parts of like kind and quality |
Model Regulation section 9: fire and extended coverage policies with replacement cost or actual cash value – NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902)
| Code | Title |
|---|---|
| naic-unfair-claims-settlement-practices-model-act-mdl-900-and-model-regulation-mdl-902::mdl902-s9a-replacement-cost-matching | Under replacement cost coverage include consequential damage from the repair and replace items in the area to a reasonably uniform appearance, at no cost to the insured beyond the deductible |
| naic-unfair-claims-settlement-practices-model-act-mdl-900-and-model-regulation-mdl-902::mdl902-s9b-actual-cash-value | Under actual cash value coverage on residential property, settle at replacement cost less depreciation and give the depreciation worksheets on request |
Model Regulation sections 1 to 4: authority, purpose, definitions, claim file and record documentation – NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902)
| Code | Title |
|---|---|
| naic-unfair-claims-settlement-practices-model-act-mdl-900-and-model-regulation-mdl-902::mdl902-s4-claim-data-retrievable | Keep claim data accessible and retrievable for examination: claim number, line, loss date, payment, denial and closure dates for the current and two preceding years |
| naic-unfair-claims-settlement-practices-model-act-mdl-900-and-model-regulation-mdl-902::mdl902-s4-file-documentation-dates | Document each claim file so the insurer's activities can be reconstructed, date-stamp every relevant document, and keep paperless files reproducible |
Model Regulation sections 5 and 6: misrepresentation of policy provisions and acknowledgement of communications – NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902)
| Code | Title |
|---|---|
| naic-unfair-claims-settlement-practices-model-act-mdl-900-and-model-regulation-mdl-902::mdl902-s5-disclose-benefits-no-concealment | Disclose to first party claimants all pertinent benefits, coverages and provisions; agents must not conceal them |
| naic-unfair-claims-settlement-practices-model-act-mdl-900-and-model-regulation-mdl-902::mdl902-s5-no-final-release-language | Do not mark a payment as final or a release unless the limit is paid or a compromise was agreed, and never use release language on partial payments |
| naic-unfair-claims-settlement-practices-model-act-mdl-900-and-model-regulation-mdl-902::mdl902-s6-acknowledge-15-days | Acknowledge a claim within fifteen days, answer department inquiries within twenty-one days, reply to other communications within fifteen days, and send forms and assistance promptly |
What is NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902) and who does it apply to?
NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902) is a compliance framework from United States (model for State adoption) with 6 domains and 18 controls. The NAIC model act and model regulation that define unfair claims settlement practices for United States insurers: the general-business-practice test, the fourteen enumerated practices (misrepresentation, slow acknowledgement, no investigation standards, bad-faith settlement, low-ball offers that force suits, unexplained denials, unidentified payments, duplicate proofs, late forms, unsupervised required repairers), and the property and casualty regulation's documentation, disclosure, acknowledgement, decision, delay-letter, payment, limitation-notice, automobile total loss, repair, subrogation, storage, crash parts, replacement cost matching and actual cash value rules. It is used by organisations to establish and maintain compliance with industry standards and regulatory requirements.
What does NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902) actually require?
NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902) has 18 controls organised across 6 domains. The largest domains are Model Act sections 3 and 4: the general business practice test and the fourteen defined unfair claims practices – NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902) (5 controls), Model Regulation section 8: automobile insurance total loss, repair, subrogation, storage and crash parts – NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902) (4 controls), Model Regulation sections 5 and 6: misrepresentation of policy provisions and acknowledgement of communications – NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902) (3 controls). Each control defines specific requirements that organisations must implement to achieve compliance.
If I already comply with another framework, how much of NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902) do I already cover?
NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902) does not currently have cross-framework mappings in our system. Check back as we continuously expand our mapping database.
How do I implement NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902)?
Start your NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902) compliance journey by running a self-assessment on our platform to identify your current compliance posture. Our AI advisory can answer specific questions about NAIC Unfair Claims Settlement Practices Model Act (MDL-900) and Model Regulation (MDL-902) requirements, and cross-framework mapping helps you leverage existing controls from other frameworks you may already comply with. Create a free account to access all 18 controls and track your progress.
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