Home > Professional Regulation > Proposed Notification Statute: Required notification to third-party claimants or judgment creditors
On March 22, 2007, the Virginia State Bar’s Public Protection Task Force approved adoption of a new statute that would require an insurer or its representative to notify a third-party claimant or judgment creditor when a check in settlement of their claim is sent to the third-party claimant's or judgment creditor's attorney or representative. The Virginia State Bar Council will consider the proposed amendment when it meets on October 19, 2007, in Norfolk, Virginia.
Proposed Notification Statute:
Notice of settlement payment in excess of five thousand dollars by insurer to an attorney or other representative of a claimant or judgment creditor
(a) Upon the payment of the sum of five thousand dollars ($5,000) or more in settlement of any third-party liability claim or judgment, where the claimant or judgment creditor is a natural person, the insurer, or its representative, shall mail to the claimant or judgment creditor notice of such payment at the same time payment is made by the insurer to an attorney or other representative of the claimant or judgment creditor.
(b) The notice required pursuant to subsection (a) of this section shall be mailed to the last known address of such claimant or judgment creditor as furnished by such claimant’s or judgment creditor’s attorney or representative at or prior to the time of settlement.
(c) For purposes of this section, “written notice� may be satisfied by providing to the claimant or judgment creditor a copy of the cover letter sent to the claimant’s or judgment creditor’s attorney or other representative that accompanied the settlement payment.
(d) Nothing in subsection (a), (b) or (c) of this section shall (1) create any cause of action or proceeding for any person or entity against an insurer based upon a failure to provide notice as required by this section or a defective notice, (2) establish a defense for any party to any cause of action based upon a failure to provide notice as required by this section or a defective notice, or (3) invalidate or in any way affect the settlement for which the payment was made by the insurer.
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Comments or questions about the proposed notification statute should be submitted in writing to Thomas A. Edmonds, Executive Director of the Virginia State Bar, 707 East Main Street, Suite 1500, Richmond, VA 23219, no later than October 1, 2007