Wash. insurance law allows treble damages

OLYMPIA, Wash.--Washington Gov. Christine Gregoire has signed into law legislation that will permit plaintiffs to recover treble damages from insurers if insurers are found to have engaged in unfair claims practices.

The Insurance Fair Conduct Act--S.B. 5726--also allows plaintiffs to recover legal costs such as fees for attorneys and expert witnesses in such cases.

Insurer groups blasted the measure--which Gov. Gregoire, a Democrat, signed Tuesday--as certain to increase the cost of coverage for individuals and businesses.

The bill will "allow virtually every insurance claim, regardless of merit, to become a 'bad faith' lawsuit--triggering access to awards totaling three times actual damages," said Kenton Brine, the Olympia, Wash.-based northwest regional manager of the Property Casualty Insurers Assn. of America, in a statement after the signing.

The American Insurance Assn. and the National Assn. of Mutual Insurance Cos. also criticized the law, saying it would impose "new" costs on businesses in the state.