Utah Admin. Code R590-122-3 - Definitions

Terms used in this rule are defined in Sections 31A-1-301 and 78B-11-102. Additional terms are defined as follows:

(1) "Compulsory binding arbitration" means a contract provision requiring arbitration as an automatic and exclusive remedy for any dispute involving a contract of insurance to the exclusion of any otherwise available judicial remedy, provided that the claim or controversy exceeds the jurisdictional limit of the small claims court of the state where the action would be brought.

(2) "Compulsory non-binding arbitration" means a contract provision requiring an insured to exhaust a procedure of extra-judicial arbitration as a condition precedent to the pursuit of an otherwise available judicial remedy.

(3) "Optional binding arbitration" means a contract provision requiring any party to an insurance contract to submit to arbitration as set forth in the contract at the election of any contracting party, provided that the claim or controversy exceeds the jurisdictional limit of the small claims court of the state where the action would be brought.

(4) "Permissible arbitration provision" means an arbitration provision in an insurance policy that:

(a) allows for an action to be brought against an insurer;

(b) prohibits the insurance policy to be construed according to the laws of another jurisdiction, except as necessary to meet the requirements of compulsory insurance laws of other jurisdictions;

(c) permits Utah courts jurisdiction over an action against the insurer; and

(d) limits the right of action against the insurer to less than three years from the date the cause of action accrues.

Notes

Utah Admin. Code R590-122-3

Amended by Utah State Bulletin Number 2021-23, effective 11/22/2021