Original article written by Matthew Stalcup on November 5, 2023
In Colorado, a homeowner’s time limit for filing a breach of contract lawsuit against an insurance company for an unpaid or underpaid claim can differ from the time limits imposed on business owners and homeowners associations.
Contractual Breach of Insurance Policy:
Under Colorado Revised Statute § 13-80-101(1), a lawsuit based on a breach of contract must be filed within three years after the cause of action accrues. However, insurers have the ability to contractually reduce this period. Notably, they can shorten it to as brief as six months from the date of loss.1 Commonly, insurance carriers reduce this period to one to two years.
In 2014, the Colorado State Legislature enacted Colorado Revised Statute § 10–4–110.8(12)(a) to safeguard homeowners. This provision prevents insurance carriers from diminishing the three-year statute of limitations period for claims made by homeowners. As a result, insurers are prohibited from issuing or renewing policies that require homeowners to sue within a timeframe shorter than the legally prescribed statute of limitations.
(12)(a) Notwithstanding any provision of a homeowner’s insurance policy that requires the policyholder to file suit against the insurer, in the case of any dispute, within a period of time that is shorter than required by the applicable statute of limitations provided by law, a homeowner may file such a suit within the period of time allowed by the applicable statute of limitations . . .
(b) On and after January 1, 2014, an insurer shall not issue or renew a homeowner’s insurance policy that requires the policyholder to file suit against the insurer, in the case of any dispute, within a period of time that is shorter than required by the applicable statute of limitations provided by law.
Read the entire article here: Why Time Matters Differently in Colorado for Homeowners, Business Owners, and HOAs