§431:10-242 Policyholder and other suits against insurer. Where an insurer has contested its liability under a policy and is ordered by the courts to pay benefits under the policy, the policyholder, the beneficiary under a policy, or the person who has acquired the rights of the policyholder or beneficiary under the policy shall be awarded reasonable attorney's fees and the costs of suit, in addition to the benefits under the policy. [L 1987, c 347, pt of §2]

Case Notes

Request by intervenor-defendant for attorneys' fees and costs denied; even assuming intervenor-defendant, as a tort victim of an insured, may under some circumstances have a "legally protectable interest" in insured's policy, intervenor-defendant was neither "the policyholder, the beneficiary under a policy, [n]or the person who has acquired the rights of the policyholder or beneficiary under the policy". 939 F. Supp. 782 (1996).

Where self-insurer rent-a-car company not an "insurer" as defined in §431:10C-103, court erred in granting attorney's fees and costs under this section. 85 H. 243, 942 P.2d 507 (1997).

Section inapplicable where, although insurer contested its liability under the policy issued to insured, insurer was not ordered by the court to pay any benefits thereunder. 103 H. 26, 79 P.3d 119 (2003).

An arbitration proceeding is not a "suit" within the meaning of this section. 103 H. 206, 81 P.3d 386 (2003).

A trial court is mandated to award attorneys' fees and costs only when such fees and costs arise in a judicial proceeding in which an insurer has contested its liability; where trial court proceeding was for confirmation of the underlying arbitration award, this section did not apply to the case. 103 H. 206, 81 P.3d 386 (2003).

Where insurer was not ordered to pay benefits under the insurance policy within the meaning of this section, insured was not entitled to attorneys' fees. 108 H. 358, 120 P.3d 257 (2005).

Trial court abused its discretion when it awarded costs and attorney's fees to claimants pursuant to this section where the trial court did not order insurers to "pay benefits" as mandated by the plain language of this section. 118 H. 174, 186 P.3d 609 (2008).

As the plain language of this section mandates an award of attorney's fees to "the policyholder, the beneficiary under a policy, or the person who has acquired the rights of the policyholder or beneficiary under the policy" whenever an insurer unsuccessfully contests its liability under a policy, insured was properly awarded attorney's fees where insurer was not successful in contesting its liability to insured for underinsured motorist benefits. 120 H. 329 (App.), 205 P.3d 594 (2009).

Circuit court did not abuse its discretion in awarding insured attorneys' fees and costs under this section where insurer disputed its liability under its auto policy and the circuit court declared that insurer had an obligation to pay insured's wage loss benefits; in light of the amount in controversy or the benefits of the services provided, the circuit court did not abuse its discretion in awarding attorneys' fees of $10,450 that incorporate a rate of $250 per hour to insured's attorneys. 124 H. 426 (App.), 246 P.3d 358 (2010).

Cited: 73 H. 322, 832 P.2d 733 (1992).

Discussed: 621 F. Supp. 2d 1025 (2008).