Provides that an insurer that does not include in its policy of underinsured motorist coverage a binding arbitration clause is subject to a civil suit at the option of the insured in superior court when a dispute arises regarding whether the insured is entitled to damages or the amount of those damages.

Provides that all automobile liability insurance policies sold in this state that contain personal injury protection coverage benefits shall contain binding arbitration clauses to resolve disputes between the insured and the insurer regarding the amount of medical and hospital expenses, funeral expenses, income continuation, and loss of services sustained by an insured because of bodily injury caused by an automobile accident.

Provides that, when a dispute regarding the amount of personal injury protection coverage benefits arises, arbitration may be requested by either the insurer or insured. In any event, a request for arbitration must be made in writing and the parties shall select an arbitrator to hear the dispute within thirty days of a written request. The failure to agree on an arbitrator within the required time is resolved under RCW 7.04.050. When arbitration results in additional benefits to the insured, the costs of the arbitrator shall be paid by the insurer, along with the reasonable costs and attorneys' fees incurred in establishing the insured's claim to additional benefits.