A new bill out of Delaware could throw a wrench into how insurers handle early settlements in auto injury claims - especially when the claimant doesn't have a lawyer.
Senate Bill 189, introduced in the state Senate on June 19, 2025, would allow unrepresented crash victims to rescind personal injury settlements for up to 60 days. The catch? The original release has to be signed within 30 days of the accident, and the person can’t have an attorney involved at the time.
If that sounds like a big deal, it is - particularly for claims adjusters used to resolving smaller injury claims quickly and cleanly. The bill takes aim at what some lawmakers see as unfair pressure tactics in the immediate aftermath of a crash, when injured individuals might not fully understand their rights or the long-term value of their claims.
Under the proposed law, to undo a settlement, the injured party would have to notify the insurer or its representative in writing and return the money - either a check or electronic payment. That notification and repayment would need to happen no later than 10 days after the end of the 60-day window. And if there’s a release form or settlement check involved, it must now clearly state, in a way that stands out, that the person has the right to rescind.
Supporters of the bill, including primary sponsor Senator Poore, argue that this is about transparency and giving people the space to make informed choices - not about punishing insurers.
“This ensures consumers have a real chance to consider their legal options before finalizing something that can’t be undone,” Poore said.
From an insurer’s perspective, the bill would complicate what’s often a streamlined process - particularly for small bodily injury claims that are settled quickly to avoid litigation. Companies would need to revise their claims procedures, retrain staff, and potentially reissue all release documents to comply with the new requirements.
And while this doesn’t mean early settlements are going away, it does create more uncertainty. That could lead to delays, disputes over returned funds, and changes in how insurers approach negotiations with unrepresented individuals.
As of now, SB189 is still making its way through the legislative process. If passed, it would take effect six months after being signed into law - giving the industry some time to adjust.
But make no mistake: if Delaware moves forward, other states could follow. Claims teams might want to start thinking now about what a post-SB189 world could look like.
