Strengthening consumer protection by increasing insurer accountability for violations of the insurance code
This bill gives the insurance commissioner authority to order restitution, including interest, for consumers harmed by an insurance company’s violation of Washington state insurance laws.
The bill recommends a simple interest rate of 8% applied to money paid back to consumers, which is the current practice. It also gives the insurance commissioner authority to assess fines against insurers for each violation of state insurance laws, which aligns the fine schedule for insurers with other regulated entities.
For entities the insurance commissioner regulates, fines are capped at $10,000 per violation or offense. Currently, the commissioner’s authority to fine property and casualty insurers — like home and auto insurance companies — is limited to $10,000, regardless of the number of violations. The restitution bill would eliminate that disparity.
Protecting consumers by prohibiting post-loss assignment of benefits in insurance claims
Post-loss assignment of benefits (AOB) is an agreement that allows a third party, like a contractor, to stand in for the policyholder and receive insurance payments directly from the insurance company. These are presented as a convenience for policyholders, but the practice has been abused in other states after natural disasters. Once a consumer signs this agreement, they lose control over their insurance benefits, which leads to inflated claims, unnecessary litigation, and higher premiums.
This bill would prohibit post-loss AOBs, which is a proactive step to preserving consumer protections, promoting transparency, and maintaining a stable insurance market.
Protecting consumers by modernizing Washington’s insurance fraud laws
This bill defines insurance fraud as its own crime in state law. The definition includes billing an insurance company or consumer for services not provided, impersonating others in insurance-related claims or transactions, and stealing insurance premium payments or premium financing loans.
It expands “victims of insurance fraud” to include insurance consumers and insurance beneficiaries, eligible for criminal restitution. It authorizes the OIC’s criminal investigators to investigate other crimes that impact the insurance industry, or insurance consumers or beneficiaries.
The bill would also expand statutory reporting of suspected insurance fraud to the insurance commissioner by adding regulators of health care or financial services professions, and other law enforcement and public safety agencies as required reporters. It also requires Washington businesses to submit executed insurance premium financing agreements to the insurance commissioner.
Additionally, the bill would clarify that state and federal peace officers hired by the insurance commissioner participate in equivalency academies offered by the Criminal Justice Training Commission.
Preventive services bill
This bill would preserve several provisions of the Affordable Care Act that are already part of Washington state law, including access to preventive services protections.
State law currently links required coverage of preventive services to recommendations from the federal Advisory Committee on Immunization Practices (ACIP), though recent federal actions have narrowed access to vaccines. This bill would preserve access to preventive services without cost-sharing for Washingtonians who use these services.
The bill would amend our preventive services coverage law to refer to the state Department of Health’s recommendations for immunization coverage, rather than the ACIP’s, and set the preventive services coverage standards to recommendations from the U.S. Preventive Health Services Task Force (USPHSTF) and Health Resources and Services Administration (HRSA) as of June 30, 2025. It would give the insurance commissioner authority to issue rules consistent with the amendments to current law in the bill.
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