SB 227

 Enrolled Copy  S.B. 227
1Punitive Damages Amendments
                                       2026 GENERAL SESSION
                                               STATE OF UTAH
                                Chief Sponsor: Ronald M. Winterton
                                     House Sponsor: Colin W. Jack
2
3  LONG TITLE
4  General Description:
5      This bill enacts provisions relating to punitive damages.
6  Highlighted Provisions:
7      This bill:
8      ▸ provides that an insurer may not rely on the existence, likelihood, possibility, or exposure
9  to punitive damages when taking actions under Title 31A, Insurance Code;
10      ▸ provides the circumstances in which a court may award punitive damages against an
11  employer, managing agent, or principal for the conduct of the employer's, managing
12  agent's, or principal's employee or agent;
13      ▸ provides that the provisions this bill enacts apply only to a claim arising after the effective
14  date of the bill; and
15      ▸ makes technical changes.
16  Money Appropriated in this Bill:
17      None
18  Other Special Clauses:
19      None
20  Utah Code Sections Affected:
21  AMENDS:
22      31A-20-101, as last amended by Laws of Utah 1986, Chapter 204
23  ENACTS:
24      78B-8-204, Utah Code Annotated 1953
25
26  Be it enacted by the Legislature of the state of Utah:
27Section 1. Section 31A-20-101 is amended to read:
 S.B. 227  Enrolled Copy
2831A-20-101 . Underwriting limitations.
29   (1) No insurer may insure or attempt to insure against:
30[(1)] (a) a wager or gaming risk;
31[(2)] (b) loss of an election;
32[(3)] (c) the penal consequences of a crime; or
33[(4)] (d) punitive damages.
34   (2) An insurer may not consider, use, or rely upon the existence, likelihood, possibility, or
35exposure to punitive damages when engaging in any of the following under this title:
36(a) underwriting;
37(b) rating;
38(c) risk classification; or
39(d) determining premiums or other charges for a policy.
40Section 2. Section 78B-8-204 is enacted to read:
4178B-8-204 . Punitive damages in an employment or agency relationship.
42   (1) As used in this section, "managing agent" means an employee or agent who:
43(a) exercises supervisory or managerial authority over a specific facility, operation,
44project, or group of employees; or
45(b) acts in a managerial capacity.
46   (2) Except as provided in Subsection (3), in an action where a plaintiff seeks punitive
47damages against an employer, principal, or managing agent based solely on the tortious
48conduct of an employee or agent, the employer, principal, or managerial agent may not
49be held vicariously liable for punitive damages based solely on the agency or
50employment relationship.
51   (3) To obtain an award of punitive damages against an employer, a principal, or a managing
52agent based solely on the conduct of an employee or agent, a plaintiff shall demonstrate
53by clear and convincing evidence that:
54(a) the employer's, principal's, or managing agent's conduct was willful, malicious, or in
55reckless disregard to the rights or safety of others;
56(b) the employer, principal, or managing agent authorized, ratified, or approved of the
57alleged conduct that gave rise to the claim; or
58(c) the employer, principal, or managing agent was reckless in employing or retaining
59the employee or agent.
60   (4) Subsections (2) and (3) apply to any claim for an award of punitive damages, including
61a claim for punitive damages arising out of the tortfeasor's operation of a motor vehicle
                                                     -2-
 Enrolled Copy  S.B. 227
62      or motorboat while voluntarily intoxicated or under the influence of any drug or
63      combination of alcohol and drugs as prohibited by Section 41-6a-502.
64  (5) The provisions of this section:
65      (a) are subject to Section 63G-7-603; and
66      (b) apply only to a claim arising on or after May 6, 2026.
67Section 3. Effective Date.
68  This bill takes effect on May 6, 2026.
                                               -3-