Claim Handling Requirements by State – Washington

Washington State is not only known as the “Evergreen State” and the only state named after a United States President, but it is also the home of many innovative Internet companies and where the biggest coffee chain in the world was founded: Starbucks. Besides these facts it is also important to know how a claim should be handled in Washington.

First an insured may bring an action in the superior court of this state to recover the actual damages sustained, together with the costs of the action, including reasonable attorneys’ fees and litigation costs.¹ The court may increase the total award of damages to an amount not to exceed three times the actual damages² or make any other determination regarding an action for an unfair or deceptive practice of an insurer or provide for any other remedy available at law.³

It is important for the first party claimant to provide a written notice of the basis for the cause of action to the insurer and office of the insurance commissioner twenty (20) days prior to filing.⁴ The notice may be provided by regular mail, registered mail, or certified mail with return requested and the insurer and insurance commissioner are deemed to have received notice three (3) business days after the notice is mailed. If a written notice of a claim is served under the time prescribed for filing an action, the statute of limitations for the action is tolled during the twenty (20) day period.⁵

Washington’s Administrative Code (WAC) defines “Specific Unfair Claims Settlement Practices.”⁶ This definition provides nineteen (19) specific deceptive acts or practices considered as unfair methods of competition and practices of the insurer in the business of insurance. Many of these acts and methods are common to those defined by statutes in other states such as misrepresenting pertinent facts,⁷ failing to acknowledge and act reasonably promptly upon communication,⁸ refusing to pay claims without conducting a reasonable investigation,⁹ and not attempting in good faith to effectuate prompt, fair and equitable settlements.¹⁰ WAC also included other specific acts or unfair methods in the business of insurance such as failing to adopt and implement reasonable standards for the processing and payment of claims after the obligation to pay has been established¹¹ and negotiating or settling a claim directly with any claimant known to be represented by an attorney without the attorney’s knowledge and consent.¹²

Both Washington codes provide a wide list for protection against unreasonable denials, payment or unfair settlements of insurance claims. It is important for Washington insureds to know of their rights under these codes and for insurers to comply.
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¹ RCWA 48.30.015 (1)
² RCWA 48.30.015 (2)
³ RCWA 48.30.015 (6)
⁴ RCWA 48.30.015 (8) (a)
⁵ RCWA 48.30.015 (8) (d)
⁶ WAC 284-30-330
⁷ WAC 284-30-330 (1)
⁸ WAC 284-30-330 (2)
⁹ WAC 284-30-330 (4)
¹⁰ WAC 284-30-330 (6)
¹¹ WAC 284-30-330 (16)
¹² WAC 284-30-330 (19)