In November, several new faces were elected to various positions within the Washington State government. This includes Patty Kuderer, who defeated Phil Fortunato to become Washington’s new Insurance Commissioner.
Recently, an AM Best report revealed some of the areas in which the newly elected Kuderer wants to implement reforms within Washington’s complex insurance code. House Bill 1199, which Kuderer is backing, would affect how the State regulates insurance code violations. The current system mandates that fines imposed by the Commissioner are directed to a general fund operated by the State. However, Kuderer argues that the current system does not provide restitution to affected consumers. Instead, the new bill would allow the Commissioner to directly order the payment of restitution to affected consumers.
While industry groups have expressed concerns about these measures, arguing that regulators can already negotiate penalties exceeding the current $10,000 limit, Kuderer believes per-violation fines are necessary to ensure accountability on the part of insurers. In supporting the bill, Kuderer looked to 40 other states that have passed similar regulations.
Another change would be to the system in which complaints are addressed by the Commissioner. Kuderer has requested a $470,000 budget increase to establish a claims review team consisting of three full-time employees focused on dispute resolution between claimants and their insurers.
In addition to resolving issues of restitution, Kuderer also wishes to address underwriting practices that may disproportionately affect policyholders based on race, gender, income, or national origin.
HB 1199 had its first public hearing in the House Committee on Consumer Protection & Business on January 24.
Lether Law Group actively tracks proposed changes to State laws across multiple jurisdictions to keep our clients fully apprised of any new developments. If you have questions about the implications of Washington’s upcoming legislative session or general questions in regard to compliance with Washington insurance law, please feel free to contact our office.
