Why consumers complain to the Insurance Commissioner

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Other Washington regulations prohibit delays in processing claims. An insurer generally must acknowledge receipt of a claim within 10 working days. WAC 284-30-360(1). The insurer is required to make “an appropriate reply” to communications from a claimant within 10 working days where that communication reasonably suggests that a reply is expected.

Insurers also are required to complete their investigations of claims within 30 days after first notice of the claim “unless such investigation cannot reasonably be completed within such time.” WAC 284-30-370.

As to first-party coverage claims, the requirements are more stringent. If the insurer needs more time to decide a first-party claim should be accepted or denied, it must notify the claimant within 15 working days why more time is needed. If the investigation remains incomplete, the insurer has 45 days from the date of the initial notification and at least every 30 days thereafter, to set forth in writing to the claimant the reasons it needs more time to complete its investigation.

Violations of these WAC regulations can trigger severe liability. Washington case law has long held that a single violation of these regulations is deemed an unfair or deceptive act or practice under Washington’s Consumer Protection Act. And Washington’s Insurance Fair Conduct Act, effective December 2007, codified the rule that the insurer is liable to its insured for even a single violation of the regulations. In an action for violation of IFCA, the insured may recover his or her reasonable attorney fees. Even worse for insurers, the Act permits the court in its discretion to award treble damages.