An Act to provide prompt payment following settlement by insurance company

194th Legislature (2025-2026) Introduced by Jeff Roy

Insurers must pay all or part of a settled amount to the plaintiff within 21 days after the plaintiff tenders a duly executed release.

Accompanied a study order, see H5336

Summary of H 1303: An Act to provide prompt payment following settlement by insurance company

What this bill would do

Create a new provision in Chapter 175 of the General Laws (Section 113A) to require insurers that have agreed to pay all or part of a settlement on behalf of a settling defendant to pay the amount due to the settling plaintiff within 21 days after the plaintiff tender's a duly executed release to the defendant.

The goal is to ensure prompt payment to plaintiffs after a damages action has been settled.

Key provisions

Insertion of Section 113A into Chapter 175.

Trigger for payment: after an action to recover damages is settled and after the plaintiff tenders a duly executed release to the settling defendant, the insurer must remit the amount due within 21 days.

Scope: Applies to insurers that have agreed to pay all or part of the settlement on behalf of a settling defendant in a civil action seeking damages.

Who is affected

Settling plaintiffs: benefit from a defined 21-day payment window following release tender.

Insurance companies: those that have agreed to pay settlements on behalf of a defendant would have a statutory obligation to pay within the 21-day period.

Settling defendants: impacted through a quicker discharge of the insurer’s payment obligation to the plaintiff.

Legislative and procedural context

Introduced: February 27, 2025 by Representative Jeffrey N. Roy (Franklin).

Filed as House Docket No. 1303; related House filing No. 1282.

Referred to the Committee on Financial Services (02/27/2025).

Hearing scheduled: May 13, 2025, from 10:00 AM to 1:00 PM, in hearing room A-2.

Status notes include “Senate concurred” and mention of a related matter filed in a prior session (House No. 1226 of 2021-2022) and replacement by HD 1282.

No explicit penalties or interest provisions are described in the provided text; the primary obligation is to pay within 21 days after release tender.

Potential impacts and considerations

Benefit to plaintiffs: reduces delays in receiving settlement funds after a release is signed.

Administrative considerations for insurers: creates a clear 21-day payment deadline; may prompt updates to internal claims-handling processes.

Legal clarity: the timing begins upon tender of the release by the plaintiff; questions could arise about what constitutes valid tender or release in practice (e.g., form, completeness, or partial releases).

Notes

The bill would be a new addition to Massachusetts insurance and settlement law (Chapter 175).

If enacted, provision would take effect upon passage and would govern settlements in which an insurer has agreed to pay part or all of the settlement.