§ 27-4-28. Discretionary clauses.
(a) No new or existing policy or certificate may contain any provision:
(1) Purporting to reserve sole discretion to the insurance company to determine eligibility
for benefits or interpret the terms of a policy or certificate; or
(2) Specifying or affecting a standard of review upon which a court may review denial
of a claim or any other decision made by an insurance company with respect to a policyholder
or certificate holder.
(b) Any such clause or language included in a contract, policy, or certif
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§ 27-4-28. Discretionary clauses.
(a) No new or existing policy or certificate may contain any provision:
(1) Purporting to reserve sole discretion to the insurance company to determine eligibility
for benefits or interpret the terms of a policy or certificate; or
(2) Specifying or affecting a standard of review upon which a court may review denial
of a claim or any other decision made by an insurance company with respect to a policyholder
or certificate holder.
(b) Any such clause or language included in a contract, policy, or certificate issued
to or covering a resident of this state that is contrary to or inconsistent with the
provisions of this section is void and unenforceable.
(c) Nothing in this section prohibits an insurer from including a provision in a contract
that informs an insured that as part of its routine operations the insurer applies
the terms of its contracts for making decisions, including making determinations regarding
eligibility, receipt of benefits and claims, or explaining policies, procedures, and
processes, so long as the provision could not give rise to a deferential standard
of review by any reviewing court.