What is S.C. Code 38-59-20?
S.C. Code 38-59-20 is South Carolina's improper claim practices statute. It lists eight acts an insurer may not commit without just cause, including unreasonable delay, refusing to pay a claim in full, and offering less to force a lawsuit. It sets a reasonableness standard rather than a day count, and the Director of Insurance enforces it.
| Statute | S.C. Code Ann. 38-59-20, Title 38, Chapter 59, Claims Practices |
|---|---|
| What it lists | Eight improper claim practices, from misrepresenting coverage to unreasonable delay |
| The test | Committed without just cause and often enough to indicate a general business practice |
| Deadline | None. No pay-or-deny day count for South Carolina property claims |
| Enforcement | Director of Insurance under 38-59-30; the fee lever for policyholders is 38-59-40 |
- • The statute lists eight acts. An act counts as an improper claim practice when committed without just cause and performed with such frequency as to indicate a general business practice.
- • It reaches accident and health, property, casualty, surety, marine, and title insurers.
- • There is no pay-or-deny day count anywhere in it. The measures are promptness, reasonableness, and good faith.
- • Enforcement of the chapter runs through the Director of Insurance under 38-59-30, which provides for notice, hearing, and penalties.
- • The section a policyholder sues on is 38-59-40: attorney fees when a covered claim goes unpaid 90 days after demand and the refusal is found without reasonable cause or in bad faith.
Two conditions sit in front of the list
The opening sentence of 38-59-20 does most of the work. It applies to insurers doing accident and health, property, casualty, surety, marine, or title insurance business, and it makes an act an improper claim practice only when the act is committed without just cause and performed with such frequency as to indicate a general business practice. Both conditions are in the statute, and both are why the Director of Insurance, not a single policyholder, is the enforcement audience for this section.
Read that as a division of labor rather than a dead end. The list below is the state's own description of what unfair claim handling looks like, so it is the vocabulary a South Carolina rebuttal, a DOI complaint ↗, and a bad-faith case all borrow.
The eight practices, in the statute's order
Each entry below states the statutory act, then what it tends to catch in a hurricane or windstorm claim. Put your own claim file next to it and mark the ones that match, with dates.
Misrepresenting the facts or the policy
Knowingly misrepresenting pertinent facts or policy provisions relating to coverages at issue, or providing deceptive or misleading information about coverages.
A denial that quotes an exclusion the policy does not contain, or that describes your endorsement inaccurately.
Not answering you promptly
Failing to acknowledge with reasonable promptness pertinent communications about claims arising under its policies.
Unanswered emails, voicemail that goes nowhere, and the adjuster rotation that resets every conversation.
No standards for investigation and settlement
Failing to adopt and implement reasonable standards for the prompt investigation and settlement of claims arising under its policies.
A file with no inspection, no measurements, and no estimate, closed on a desk review.
No good-faith settlement once liability is clear
Not attempting in good faith to effect a prompt, fair, and equitable settlement of claims in which liability has become reasonably clear.
The carrier concedes the peril and the damage, then holds the number open for months.
Forcing you to sue
Compelling policyholders to institute suits to recover amounts reasonably due by offering substantially less than the amounts ultimately recovered through those suits or through settlements with their attorneys.
The offer that moves only after a lawyer appears, which is the pattern the subsection describes.
Discounting the claim for your legal costs
Offering to settle for less than the amount otherwise reasonably due based on the possibility or probability that you would have to incur attorney fees to recover it.
A settlement priced off what a fight would cost you rather than off the loss.
Bad-faith policy defenses and rescission threats
Invoking or threatening to invoke policy defenses or rescission of the policy as of inception, not in good faith and without a reasonable expectation of prevailing, but primarily to discourage or reduce a claim.
A late-arriving misrepresentation theory raised after the damage is documented.
Unreasonable delay, or failure to pay in full
Any other practice constituting an unreasonable delay in paying, or an unreasonable failure to pay or settle in full, claims arising under coverages provided by its policies.
The catch-all, and the one most storm claims land on. It is where a year of adjuster churn is argued.
Item (8) is the one most storm claims argue. It is written as a catch-all for any practice that is an unreasonable delay in paying or an unreasonable failure to pay or settle a claim in full, which is exactly the shape of an adjuster rotation, a reopened inspection, and a supplement offered a year late. The State Farm Helene file in the denial documents is that pattern in a single claim.
South Carolina writes no deadline, so your file is the deadline
Nothing in 38-59-20 says 30 days, 60 days, or 90 days. Every measure in it is comparative: reasonable promptness, prompt investigation, prompt and equitable settlement, unreasonable delay. Comparative standards are proved with timelines, which means the policyholder who keeps one is the policyholder who can use this statute.
Log six things and nothing else matters much: the date you reported the loss, every communication with the date and the name on the other end, each adjuster handoff, each inspection, the date each estimate reached you, and the date of every payment, partial payment, or refusal. Photograph the damage on the photo protocol before repairs, and send anything important in writing so the date is not a memory.
Two clocks do run against you even though none runs against the carrier. Your policy sets a notice requirement, and S.C. Code 15-3-530 sets a three-year limitation on contract and policy actions. Run the deadline countdown before you spend another month waiting on an adjuster.
What 38-59-20 does not do
It does not pay your claim, and it does not by itself put money in your hand. Chapter 59 places enforcement with the Director of Insurance: 38-59-30 provides for notice, hearing, and penalties, and 38-59-50 separately prohibits paying or settling benefits in merchandise or services. The section that runs through your own lawsuit is 38-59-40, which makes the carrier liable for your reasonable attorney fees when a covered claim goes unpaid 90 days after demand and the trial judge finds the refusal was without reasonable cause or in bad faith.
Alongside the statute, South Carolina recognizes a first-party common-law bad-faith action with consequential damages and, on the right facts, punitive exposure. The conduct described in 38-59-20 is the evidence in both. That is the practical value of the list: it tells you what the state already considers unreasonable, in the state's own words.
Florida runs the same idea on a stopwatch
A policyholder with property in both states is dealing with two different designs. Fla. Stat. 626.9541(1)(i) is Florida's analogue to this list, an unfair claim settlement practices statute that prohibits misrepresenting policy provisions, denying without a reasonable investigation, and failing to promptly explain the basis of a denial. Florida then adds the clock South Carolina leaves out: Fla. Stat. 627.70131 gives the carrier 7 days to acknowledge and 60 days to pay or deny, with a written explanation of the policy basis in relation to the facts or applicable law.
The other Florida difference is the private remedy. Fla. Stat. 624.155 creates a statutory bad-faith action that starts with a Civil Remedy Notice and a 60-day cure window. South Carolina has no equivalent filing. The equivalent leverage here is the fee statute, and the record that supports it. The full statute library lays both states side by side.
Questions about 38-59-20
Does S.C. Code 38-59-20 let me sue my insurance company? +
The section defines improper claim practices. Enforcement of the chapter runs through the Director of Insurance under S.C. Code 38-59-30, which provides for notice, hearing, and penalties. The remedies that run through your own case are S.C. Code 38-59-40, which shifts attorney fees when a covered claim goes unpaid 90 days after demand and the refusal is found without reasonable cause or in bad faith, and the South Carolina common-law bad-faith action. Confirm how the sections fit your facts with a South Carolina attorney.
How many days does a South Carolina insurer have to pay or deny a claim? +
No fixed number. Nothing in 38-59-20 sets a day count for property claims. The statute measures acknowledgment, investigation, and settlement against promptness, reasonableness, and good faith. Florida is the opposite design: Fla. Stat. 627.70131 gives its carriers 7 days to acknowledge and 60 days to pay or deny. In South Carolina the yardstick is the record you keep.
What does "general business practice" mean here? +
The opening sentence of 38-59-20 qualifies the whole list: an act is an improper claim practice when committed without just cause and performed with such frequency as to indicate a general business practice. That framing is aimed at a pattern across a book of claims, which is what a regulator can act on. Your single file still matters, because the same conduct is the evidence in a 38-59-40 fee claim and a bad-faith case.
What should I be writing down while the claim is open? +
Every date. When you reported the loss, every call and email and who answered, each adjuster name and the date they took over, the date of each inspection, the date each estimate reached you, and the date of every payment or refusal. Reasonableness is judged on that timeline, so a claim with a complete timeline is a claim that can be measured.
- S.C. Code Ann. 38-59-20 (improper claim practices), 38-59-30 (notice and hearing by the Director; penalties), 38-59-40 (attorney fees) · scstatehouse.gov ↗
- S.C. Code Ann. 15-3-530 (three-year limitation) · scstatehouse.gov ↗
- Fla. Stat. 627.70131 (7-day acknowledgment; 60-day pay or deny; written basis) · flsenate.gov ↗
- South Carolina Department of Insurance, Office of Consumer Services (complaint intake, 803-737-6180 or 1-800-768-3467) · doi.sc.gov ↗
Statute summaries drafted August 2026 and simplified for education; verify against current statute. Not legal advice; consult an attorney about your specific claim.
Measure your carrier against the list.
Send the dates and the letters. You will get a straight answer on which acts in 38-59-20 your file matches, whether the record supports a 38-59-40 fee claim, and what the next move is.
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