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Bad Faith Blog

We cover current issues, highlights and best practices exclusively on claims of bad faith and extra contractual damages.

Bad Faith Blog
June 25, 2017

No Independent Cause of Action for Stand Alone Regulatory Violations of Washington’s Insurance Fair Conduct Act

Perez-Crisantos sustained injuries resulting in more than $50,000 in medical bills. After settling with the underinsured motorist (UIM) and collecting $10,000 in medical expenses and $400 in lost wages under the PIP coverage from State Farm, his insurer, he sought additional funds from State Farm, claims which eventually went to arbitration. The arbitrator largely ruled in favor of Perez-Crisantos who then filed claims for bad faith, negligence, violation of Washington’s Consumer Protection Act (CPA), and violation of IFCA. After a reduction for the sums already paid, there was a net UIM award of $24,000. Perez-Crisantos’s “IFCA claim [was] based on the violation of IFCA regulations relating to unfair settlement practices[,]” contending “that State Farm forced him to litigate in order to get payments that were due to him.” The trial court granted State Farm’s motion for summary judgment after concluding there was no “scintilla of evidence” that State Farm’s actions were “unreasonable and there must have been some ulterior motive” for them, such as “some sort of incentive program to ‘lowball claims.’” On direct appeal to the Supreme Court of Washington, the court affirmed.