wa-law.org > bill > 2025-26 > SB 6359 > Original Bill

SB 6359 - 3rd party auto. appraisals

Source

Section 1

  1. The legislature finds that:

    1. Under Washington law, persons injured by another's negligent operation of a motor vehicle are entitled to recover the full measure of their property damages, including the reasonable cost of necessary repairs, the diminished value of repaired vehicles, and compensation for loss of use, as outlined in Washington pattern jury instructions 30.10 and Grothe v. Kushnivich, No. 39010-1-III (Wash. Ct. App. Dec. 6, 2022);

    2. At present, the only means by which a third-party claimant may obtain a judicially enforceable resolution of a property damage dispute with an automobile liability insurer is to file a civil lawsuit. For many consumers, the cost of retaining counsel and litigating such claims is disproportionate to the value of the loss, leaving them without an effective remedy;

    3. Washington has already recognized through RCW 48.18.620 that appraisal is an efficient, fair, and cost-effective method to resolve first-party disputes over automobile property damage; and

    4. Other states, including North Carolina and Rhode Island, have enacted statutes allowing third-party claimants to invoke appraisal in disputes over automobile property damage, including total losses, repairs, diminished value, and loss of use.

  2. It is therefore the intent of the legislature to:

    1. Provide Washington consumers with a statutory right to appraisal in third-party automobile property damage claims, consistent with existing law on the measure of damages;

    2. Ensure that this right is enforceable directly by claimants, without regard to whether insurers include this policy language; and

    3. Provide clear enforcement mechanisms, either through the consumer protection act or through the insurance commissioner, to guarantee that insurers comply with this statutory right.

Section 2

  1. A third-party claimant asserting a property damage claim against an automobile liability insurer may demand appraisal when the claimant and the insurer are unable to agree on the amount of loss. This right exists independently of the policy language and applies to all automobile liability insurance policies issued or renewed on or after January 1, 2027.

  2. Either the insurer or the third-party claimant may make a written demand for appraisal. Within 10 days of the demand, each party shall select a competent and disinterested appraiser and notify the other of its selection. The appraisers shall separately appraise the amount of loss and, if unable to agree, shall select a competent and disinterested umpire. If the appraisers cannot agree upon an umpire within 15 days, either party may petition the commissioner to appoint one. The appraisers shall submit their differences to the umpire. An agreement of any two is binding as to the amount of loss.

  3. Each party must bear the cost of its own appraiser, and the cost of the umpire must be shared equally.

  4. An insurer that fails to comply with this section is subject to enforcement action by the commissioner, including fines of up to $10,000 per violation, suspension or revocation of its certificate of authority, and any other remedies authorized under this title.

  5. Nothing in this section affects a claimant's right to elect civil remedies in addition to or in lieu of an appraisal under this section.

  6. The commissioner shall administer and enforce this section and may adopt rules to implement the requirements of this section.

  7. For purposes of this section, the following definitions apply:

    1. "Competent" has the same meaning as defined in RCW 48.18.620;

    2. "Disinterested" has the same meaning as defined in RCW 48.18.620;

    3. "Property damage" includes:

      1. The reasonable cost of necessary repairs;

      2. The total loss value of the damaged vehicle;

      3. Diminished value of the vehicle after repair; and

      4. Loss of use, including reasonable rental car costs or cash compensation; and

    4. "Umpire" means a person selected by the appraisers representing the insurer and the third-party claimant, or, if the appraisers cannot agree, by the commissioner.

Section 3

Nothing in this act expands or contracts the substantive measure of damages recoverable in tort under Washington law. This act provides only an alternative, nonjudicial means of resolving disputes over the amount of property damage.

Section 4

This act takes effect January 1, 2027.

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