Washington Passes Stringent Insurance Fair Conduct Act


On May 15, 2007, Washington State Governor

Christine Gregoire signed the Insurance Fair Conduct

Act into law. The Act allows recovery of uncapped

treble damages for unreasonable denial of a claim for

coverage or payment of benefits, and recovery of

uncapped treble damages for violation of certain

insurance regulations.

How does this Act change the amount an insured may recover for "bad faith" or for a violation of certain insurance


Prior to this Act, an insured who proved insurance bad faith was entitled to his actual damages, plus treble damages up to $10,000 per act of bad faith, plus attorney fees. This Act now allows a court to award uncapped treble damages and expert witness fees and actual costs of suit, in addition to all other remedies currently available. However, only "actual" damages may be trebled. This means that emotional distress awards may not be trebled.

Where does this Act apply?

This Act only applies to claims filed under Washington state law.

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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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