The Washington Office of the Insurance Commissioner has adopted a new rule changing the state's minimum standards for claims handling in order to target unfair trade practices.
The office states that while the number of auto and homeowners insurance claims has remained consistent over the past six years, there has been a sharp increase in consumer complaints and Insurance Fair Conduct Act notices. The new rule updates the Washington Administrative Code in order to protect consumers.
The amended rule adds to the definition of what constitutes an unfair claims settlement practice. Insurers cannot deny or refuse to pay a claim without conducting a reasonable investigation, and cannot make a determination based solely on a database or estimating software.
For motor vehicle claims, insureds have a right to an in-person inspection. The inspection must be conducted within five days or another agreed-upon time. Insurers may not require an insured to agree to only photo-based evaluation and cannot force insureds to solely use an internet-based application to submit information.
The rule also sets standards for an insurer to acknowledge communications. Insurers must acknowledge receipt of a claim within 10 business days for an individual insurance policy and within 15 business days for a group insurance contract. The investigation of a claim must be completed within 30 days, unless it cannot be reasonably completed in that time.
The rule is effective August 18, 2026, and can be found here.
Ray Sugrim
Ray Sugrim is an Insurance Editor with FC&S Expert Coverage Interpretation, a division of National Underwriter Company and Arc Network. Ray is responsible for helping develop and edit content for subscribers. Ray is a St John’s University graduate with a degree in Risk Management & Insurance and is a CPCU candidate.