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940Type of Legislation: General Bill GBIntroducing Body: SenateIntroduced Date: 20000111Primary Sponsor: LandAll Sponsors: Land, RankinDrafted Document Number: l:\s-jud\bills\land\jud0070.jcl.docResiding Body: SenateCurrent Committee: Banking and Insurance Committee 02 SBISubject: Insurer's subrogation classified as equitable right, enforced only by judicial decision; InsuranceHistory Body Date Action Description Com Leg Involved ______ ________ ______________________________________ _______ ____________ Senate 20000119 Co-Sponsor added by Senator Rankin Senate 20000111 Introduced, read first time, 02 SBI referred to Committee Senate 19991019 Prefiled, referred to Committee 02 SBI Versions of This Bill
TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING SECTION 38-59-60, SO AS TO CLASSIFY INSURER'S SUBROGATION AS AN EQUITABLE RIGHT, ENFORCEABLE ONLY BY A JUDICIAL DECISION RENDERED IN LIGHT OF THE FACTS AND CIRCUMSTANCES OF EACH CASE.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Chapter 59, Title 38, of the 1976 Code is amended by adding:
"Section 38-59-60. (A) Insurers' subrogation policies are equitable rights, enforceable by a court of competent jurisdiction.
(B) Subrogation claims by insurance carriers on any policy issued or delivered in the State shall be limited by principles of equity. The insured's right to compensation is not affected by third party liability, and the insured may sue or settle with a third party without the insurer's consent.
(C) Whenever the insured or his representative enters into a settlement or obtains a judgment upon trial that is less than the amount of the insured's estimated total damages, the court may proportionately reduce the amount of the carrier's lien on the proceeds of such settlement or judgment. Lien reduction shall be based upon the court's evaluation of the estimated total cognizable damages at law and the judgment or settlement award.
(D) The court shall consider the insured's necessary expenses including, but not limited to, medical bills and attorney's fees. The court shall make a determination of the ratio the subrogation claim bears to the settlement reached or verdict rendered and assess against the subrogation claim a pro rata share of the expenses incurred in reaching the settlement or verdict. Further, the court shall reduce the subrogation claim by the attorney fee percentage for which the insured contracted in making a third party claim.
(E) Any such reduction pursuant to this section shall be based on the determination by the court that such reduction would be equitable to all parties concerned, and best serves the interest of justice."
SECTION 2. If any provision of this act or the application thereof to any person is held invalid, the invalidity shall not affect other provisions or applications of the act which can be given effect without the invalid provision or application, and to this end the provisions of this act are severable.
SECTION 3. This act takes effect upon approval by the Governor.
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