§ 999.3.Acceptance

Title 14. Of Miscellaneous Provisions · Chapter 3.2. Time-Limited Demands · Enacted 2022 · no amendments on record · Last verified July 28, 2026

In one sentenceSection 999.3 lets a recipient accept a time-limited demand by agreeing in writing to all its material terms, protects requests for clarification or an extension from being treated as a rejection, and requires an insurer that won't accept a demand to explain its decision in writing before the deadline passes.

Full Text of § 999.3

Text sizeJump to: (a) (b) (c)

(a) The recipients of a time-limited demand may accept the demand by providing written acceptance of the material terms outlined in Section 999.1 in their entirety.

(b) Upon receipt of a time-limited demand, an attempt to seek clarification or additional information or a request for an extension due to the need for further information or investigation, made during the time within which to accept a time-limited demand, shall not, in and of itself, be deemed a counteroffer or rejection of the demand.

(c) If, for any reason, an insurer does not accept a time-limited demand, the insurer shall notify the claimant, in writing, of its decision and the basis for its decision. This notification shall be sent prior to the expiration of the time-limited demand, including any extension agreed to by the parties, and shall be relevant in any lawsuit alleging extracontractual damages against the tortfeasor's liability insurer.

Plain-English Summary

Accepting a time-limited demand under this chapter takes a specific form: written acceptance of the material terms set out in § 999.1, in their entirety. Partial acceptance or an attempt to modify the terms doesn't satisfy this section.

The statute also protects ordinary back-and-forth during the response window. If the insurer asks for clarification, requests additional information, or asks for an extension because it needs more time to investigate, none of that, by itself, counts as a counteroffer or a rejection of the demand. That protection lets an insurer engage with a demand without accidentally forfeiting the chance to accept it.

If the insurer ultimately decides not to accept the demand, it has to tell the claimant in writing, explaining the basis for that decision, before the demand's deadline expires — including any extension the parties agreed to. That written explanation isn't just a courtesy: § 999.3(c) makes it relevant evidence in any later lawsuit alleging extracontractual damages against the insurer, the kind of bad-faith claim an unreasonable refusal to settle within policy limits can trigger.

Frequently Asked Questions

How does a recipient accept a time-limited demand?

By providing written acceptance of all the material terms set out in § 999.1, in their entirety.

Does asking for more time or more information count as rejecting the demand?

No. Seeking clarification, requesting additional information, or asking for an extension because more investigation is needed doesn't, by itself, count as a counteroffer or rejection.

What must an insurer do if it decides not to accept a time-limited demand?

Notify the claimant in writing of its decision and the basis for it, before the demand (including any agreed extension) expires.

Why does that written notification matter beyond the settlement negotiation itself?

Section 999.3(c) makes it relevant in any later lawsuit alleging extracontractual damages against the insurer, such as a bad-faith failure-to-settle claim.

Amendment History

Added by Stats 2022 ch 719 (SB 1155),s 1, eff. 1/1/2023.

Source & verification. Section text is reproduced verbatim from the Deering's California Codes Annotated / vLex. Enacted by the California Legislature. Last verified July 28, 2026. · Official source

Also known as: accepting a time-limited demand californiainsurer rejection of settlement demand