Delaware Code
Subchapter I. General Provisions
§ 2118B. Processing and payment of insurance benefits.

(a) The purpose of this section is to ensure reasonably prompt processing and payment of sums owed by insurers to their policyholders and other persons covered by their policies pursuant to § 2118 of this title, and to prevent the financial hardship and damage to personal credit ratings that can result from the unjustifiable delays of such payments.
(b) When an insurer is notified in writing by the claimant that the claimant desires to file an initial claim for benefits pursuant to § 2118(a)(2) of this title, the insurer shall, no later than 10 days following the insurer's receipt of said notification, provide that claimant with a form for filing such a claim. For purposes of this subsection an insurer shall be deemed to have provided a claimant with a form for filing a claim when the insurer deposits such a form in an envelope addressed to such claimant with the United States Postal Service and with postage affixed for first class (or better) delivery. If an insurer fails to comply with the provisions of this subsection, the insurer shall pay the claimant a sum equal to 1 percent of the amount due as of the date on which the claim was required to be provided for each day beyond the prescribed period for compliance, not to exceed $5,000.
(c) When an insurer receives a written request for payment of a claim for benefits pursuant to § 2118(a)(2) of this title, the insurer shall promptly process the claim and shall, no later than 30 days following the insurer's receipt of said written request for first-party insurance benefits and documentation that the treatment or expense is compensable pursuant to § 2118(a) of this title, make payment of the amount of claimed benefits that are due to the claimant or, if said claim is wholly or partly denied, provide the claimant with a written explanation of the reasons for such denial. If an insurer fails to comply with the provisions of this subsection, then the amount of unpaid benefits due from the insurer to the claimant shall be increased at the monthly rate of:

(1) One and one-half percent from the thirty-first day through the sixtieth day; and
(2) Two percent from the sixty-first day through the one hundred and twentieth day; and
(3) Two and one-half percent after the one hundred and twenty-first day.
(d) If an insurer fails to comply with subsection (b) or (c) of this section, the claimant may recover the amount due through a civil action in any court of competent jurisdiction or through a Delaware Insurance Commissioner's Arbitration Proceeding, consistent with § 2118(j)(1)-(9) of this title, at the option of the claimant. Any judgment entered for a claimant in a civil action or arbitration proceeding brought under this section shall include, in addition to the amount due and any additional amount provided for by subsections (b) and (c) of this section, an award for the costs of the action and the prosecution of the action, including reasonable attorney's fees; provided, however, that the costs of the action and the prosecution of the action, including reasonable attorney's fees shall only be awarded if it is found that the insurer acted in bad faith. The burden of proving that the insurer acted in bad faith shall be on the claimant. Any sums other than the original claim paid under this subsection shall not reduce the amount of coverage available under the insurance policy that is the basis for the claim.
(e) If an action pursuant to subsection (d) of this section is not filed within 90 days of the date of denial or the date when benefits are due as provided for in subsection (c) of this section, the penalties prescribed in that subsection shall begin to run from the date of the filing of said action.
(f) The remedies provided by this section are in addition to all other remedies available to the claimant under state and federal statutory or common law.

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