Understanding Common Law Bad Faith Insurance Claims in Washington

When you make a claim against an insurance policy, you have a reasonable expectation of fair treatment. In Washington, insurance companies are required to use good faith settlement practices. An insurer can be held legally liable for damages caused by bad faith conduct. Washington has two main bad faith insurance statutes in place:

• Consumer Protection Act (CPA) – RCW 19.86.020; and
• Insurance Fair Conduct Act (IFCA) – RCW 48.30.015.

Additionally, bad faith insurance practices are also a breach of the common law in Washington. You can file a common bad faith claim against your insurance company if you are treated unfairly. In this article, our Spokane insurance denial lawyers provide a guide to common law bad faith insurance claims in Washington State.

Definition: The Common Law

The common law is a law that is derived from judicial & quasi-judicial decisions instead of state or federal statutes. Similar to virtually all jurisdictions in the United States, Washington is a common-law state. There are laws in place that come from precedent created by court decisions, including laws that protect policyholders against bad faith settlement practices by insurance companies.

Common-Law Bad Faith Insurance Claims in Washington

If you were mistreated by an insurance company—whether you were filing a car accident injury claim, a long-term disability claim, or a homeowners’ insurance claim—you have common law rights in Washington. Here are three key things to know about common law bad faith claims:

1. All Insurers Owe a Duty of Good Faith: In judicial decisions, Washington courts have consistently held that all insurance companies owe an implicit “duty of good faith” to policyholders. Bad faith claims are more complicated for third-party claimants.
2. Bad Faith Plaintiffs are Not Limited to Economic Damages: Bad faith insurance practices constitute a common-law tort in Washington. As such, parties can seek compensation for the full extent of their losses, including for non-economic damages.
3. A Three-Year Statute of Limitations: In Washington, state courts have developed a three-year statute of limitations for common law bad faith claims. Policyholders should always be prepared to take proactive steps to protect their rights against bad faith conduct by an insurer.

Of course, common law claims are not the only bad faith insurance claims in Washington. You may also have a bad faith claim under either one of the state’s specific statutes, including under the CPA or IFCA. An experienced Washington insurance denial attorney will protect your rights.

Consult With a Spokane, WA Insurance Law Attorney

At‌ ‌Albrecht‌ ‌Law‌ ‌PLLC, our Spokane insurance law lawyers have the skills and experience to hold companies liable for bad faith settlement practices. If you have any questions about filing a common law bad faith insurance claim, we are available to help. Call us now or connect with our Spokane office online for a free, no-obligation consultation. We are proud to fight for the rights and interests of policyholders in bad faith insurance claims throughout all of Eastern Washington.