Binding Arbitration Agreements in Insurance Contracts are Void in Washington

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In Washington State Department of Transportation v. James River Insurance Company, Wash. No. 87644-4 (January 17, 2013), the Washington Supreme Court declared binding arbitration agreements in insurance contracts void and unenforceable. The court explained that binding arbitration frustrates legislative intent to protect Washington policyholders’ rights to sue insurers in Washington courts for coverage disputes over subjects located, resident or to be performed in Washington.

Background Facts -

James River Insurance Company issued two surplus lines insurance policies — one primary and one excess — that provided certain coverages related to a highway project. The Washington State Department of Transportation (WSDOT) was an insured on the policies.

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Topics:  Arbitration, Arbitration Agreements, Binding Arbitration

Published In: Alternative Dispute Resolution (ADR) Updates, Civil Remedies Updates, Insurance Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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