Every person who drives an automobile or motorcycle in Washington State is required to have an automobile insurance policy. If not carrying a liability insurance policy a person may apply for a certificate of deposit to pay for their liability, have a liability bond filed by an authorized surety bond company, or be self-inured if in possession of more than 26 vehicles.

The automobile insurance policy contract must provide that the insurer will give the insured a certain amount of notice prior to cancellation or nonrenewal.

The Office of the Insurance Commissioner is responsible for adopting standard policy forms for property and casualty insurance, including automobile insurance. The Department of Licensing is responsible for ensuring drivers have the mandatory automobile insurance and approves insurance identification cards produced by insurers to be used for proof of compliance.

Requires every basic automobile insurance contract issued or renewed on or after January 1, 2025, to include a provision for the right to an appraisal and a provision, if the car is repairable, requiring the amount paid by the insurance company restore the vehicle to its prior condition before the loss.

A basic automobile insurance contract is one that includes first-party coverage for physical damage of an automobile.

Right to an Appraisal. The automobile insurance contract must have an appraisal clause containing specific language on the right to appraisal to resolve disputes between the insurer and the insured regarding actual cash value and amount of loss on the damaged vehicle. The provision requires:

• each party to choose a competent and disinterested appraiser within ten days of a written demand when the insurance company and the policy holder are unable to agree as to the amount of loss;
• the appraiser to pick a competent and disinterested umpire within 15 days. If the appraiser does not wish to appoint an umpire, either party may request a judge of a court of competent jurisdiction to pick an umpire;
• the appraiser to appraise a loss, make separate findings regarding the amount of loss for each element of loss and, if unable to agree on the losses, to submit their differences to the umpire;
• the amount of loss to be determined either by agreement of the appraisers or by agreement of one appraiser and the umpire;
• reimbursement if the amount of loss determined is greater than the amount of loss the insurance company adjusted before the appraisal process was invoked; and
• that the actual costs for the appraiser, attorneys' fees, and other necessary costs be reasonable.

Right to Previous Condition if Repairable. The automobile insurance contract must also have a provision requiring that the amount paid under the claim must allow the vehicle to be restored to its condition prior to the loss, if repairable.

Payment of Claim Be Reasonable. Payment of a claim must be based on reasonable and necessary costs at the claimant's chosen repair facility. The insurance company has the burden to prove the costs at the claimant's chosen repair facility are unreasonable or unnecessary. Nothing mandates an insurance company to pay for parts supplied by the original equipment manufacturer other than that the use of alternative parts would fail to restore the vehicle to its previous condition.