Creates an efficient and cost-effective industrial insurance system for the benefit of both employers and employees by introducing competition into the system through a choice of insurance carriers from whom employers may purchase industrial insurance.

Creates the joint legislative task force on private competition for industrial insurance and requires the task force to develop proposed legislation to eliminate Washington's monopoly of the industrial insurance fund by conforming current statutes to make them consistent with the provisions contained in the act.

Creates the Washington state industrial insurance fund for the purpose of insuring employers for certain liability, beginning July 1, 2012.

Creates the industrial insurance administrative fund to provide for the payment of certain expenses of the board of industrial insurance appeals and the insurance commissioner.