S-1194               _______________________________________________

                                                   SENATE BILL NO. 5547

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State of Washington                              50th Legislature                              1987 Regular Session

By Senators Garrett and Moore

Read first time 2/4/87 and referred to Committee on Financial Institutions.

AN ACT Relating to insurance claims payments; adding a new section to chapter 48.18 RCW; and creating a new section.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1.     The legislature hereby recognizes that liability insurance has become increasingly expensive and difficult to obtain.  The legislature also recognizes that insurance costs allegedly are related to the claims experiences of insureds and classes of insureds and that frequently insurance companies expedite claims processing by agreeing to settlements without consultation with the insured.  The purpose of this act is to require insurance companies to notify and consult with insureds prior to settlement of claims.

NEW SECTION. Sec. 2.  A new section is added to chapter 48.18 RCW to read as follows:

          Upon and after the effective date of this section, every newly issued or renegotiated contract for liability insurance shall provide that the insured shall be entitled to notification of a pending claim and consulted with before agreement by the insurance company to settlement of a claim.