Washington Democratic Gov. Christine Gregoire signed legislationyesterday that would make it easier to convict insurers of badfaith and impose triple damages.

Her signature came despite pleas from insurance groups who arguethat the measure will spur unnecessary lawsuits.

The American Insurance Association, the National Association ofMutual Insurance Companies and the Property Casualty InsurersAssociation of America had all urged the Democratic chief executiveto veto SB 5726, the Insurance Fair Conduct Act.

The measure passed the Democratic-controlled House and Senate,mostly along party lines, earlier this year.

"SB 5726 will line the pockets of plaintiff trial lawyers withgold at the expense of the insurance consumer," complainedChristian John Rataj, NAMIC Western Region State AffairsManager.

The legislation establishes a statutory right to sue an insurerfor bad faith and sets what insurance officials claim is the lowestthreshold for conduct an insurer must engage in to trigger not onlya suit but treble damages, which in the state is akin to punitivedamages.

Kenton Brine, PCI NW Regional Manager, said, "By setting thenation's lowest threshold for allowing punitive lawsuits againstinsurers for even minor or accidental claims-handling mistakes, SB5726 will allow virtually every insurance claim, regardless ofmerit, to become a 'bad faith' lawsuit--triggering access to awardstotaling three times actual damages."

In addition, the new law lowers the burden of evidence theplaintiff's must show from "clear and convincing" to a"preponderance" of the evidence.

"The governor's signing of this legislation is especiallyperplexing, given her stated priority of making Washington a morefriendly state in which to do business," said Ken Gibson, AIA vicepresident, Western Region.