This article originally appeared as a Gavel to Gavel guest column in the Journal Record on May 15, 2025.
Kelsey A. Chilcoat
In response to growing public frustration with health insurance claim denials, the Oklahoma Legislature is considering a significant policy shift intended to protect consumers in the health insurance marketplace. House Bill 2144, known as the Insurance Consumers Protection Act, seeks to create a statutory cause of action for bad faith conduct by health insurance companies, expanding the ability of individuals to bring legal claims when they believe an insurer has acted unfairly in handling their claim.
Supporters of the bill argue it is a necessary response to growing concerns over the sometimes opaque and burdensome process of obtaining insurance coverage for necessary medical care. By creating a statutory remedy, the bill aims to increase accountability among insurers and provide consumers with clearer legal recourse when they believe an insurance company has acted inappropriately.
However, the bill has sparked strong opposition from many within the business and legal communities who caution that its current language could introduce substantial uncertainty and unintended consequences in Oklahoma’s legal and insurance systems.
One key concern is the bill’s creation of a new statutory bad faith cause of action without replacing or clarifying the existing common law remedy. Critics argue that this dual-track approach could lead to overlapping litigation, legal confusion, and inconsistent outcomes. They also warn that it may encourage forum shopping and unnecessary legal costs for all parties involved.
Additionally, HB 2144 would significantly broaden the category of individuals who may bring a bad faith claim. Under current law, only policyholders or others directly entitled to benefits under an insurance contract can sue. The bill, however, expands the definition of “third-party beneficiary” to include providers, lienholders, and others who are not signatories to the policy. This change could open the door to a much larger volume of litigation.
The bill also prohibits summary judgment in bad faith cases, meaning even claims with limited merit may be required to proceed to trial. Potential impacts could include clogged court dockets and increased pressure on insurers to settle cases quickly, potentially driving up the cost of doing business in the state.
Other contentious provisions include a broad redefinition of “insurance” that may inadvertently sweep in a wide range of contractual indemnity arrangements not traditionally considered insurance. Further, the revised standards for proving bad faith and punitive damages lower the bar for claimants in ways both subjective and inconsistent with established precedent.
While the bill’s intent is clearly rooted in consumer protection, its practical effects could reshape not only insurance litigation but also contract law and regulatory authority in Oklahoma. As debate continues in the State Senate, stakeholders from across the legal, business, and healthcare sectors will be watching closely to see whether the final legislation strikes a balance between greater accountability and preserving a stable insurance market.
About the author:
Kelsey A. Chilcoat represents individuals and corporations in a broad range of matters and through all stages of litigation, including first and third-party insurance defense, intellectual property, landlord/tenant disputes, and breach of contract.
CONTACT: kachilcoat@phillipsmurrah.com | 405.606.4728
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