Washington Jury Instruction: Insurance Fair Conduct Act

Posted Tuesday, February 28, 2017 by Ed Harper

Washington Jury Instruction on Insurance Fair Conduct Act

Washington Pattern Instruction 320.06.01 states as follows: “Plaintiff claims that (name of insurer) has violated the Washington Insurance Fair Conduct Act (IFCA). To prove this claim, the plaintiff has the burden of proving each of the following propositions:

1 – that the insurer unreasonably denied a claim for coverage or unreasonably denied payment of benefits or violated a statute or regulation governing the business of insurance handling;

2 – that the plaintiff was injured or damaged; and

3 – that the insurer’s act or practice was a proximate cause of the plaintiff’s injury or damage.

If you find from your consideration of all the evidence that each of these propositions has been proved, your verdict on this claim should be for the plaintiff. On the other hand, if any of these propositions has not been proved, your verdict on this claim should be for the insurer.” (Emphasis has been added.)

In a recent case, Perex-Chrisantos v. State Farm Fire and Casualty Company, 92267-6 (February 2, 2017), the Washington Supreme Court viewed the portion of this instruction “violated a statute or regulation governing the business of insurance claims handling” and was beyond the IFCA provisions. The court stated “on balance, we conclude that the legislative history indicates that IFCA does not create a cause of action for regulatory violations.”

The court mentioned that jury instructions are not law. State v. Brush, 183 Wn. 2nd at 557. When misstating the law, the jury instruction deceives the jury. Instead the court “shall declare the law.” Here, the court determined that the jury instruction incorrectly interpreted the statutory law which articulated and set up IFCA.

Apparently the committee who instituted the pattern jury instruction failed to comprehend that IFCA allows the 1st and 2nd portions and part of the 3rd of the jury instruction but not – solely as violation of a statute or regulation for the case to continue of an IFCA violation. A statutory violation may still be evidence of an unreasonable act or actions by the insurance company, but this does not lead to straightaway proof of an IFCA violation on its own.

The court continued that they felt “it is unlikely the legislature would’ve intended to create a private cause of action for violation of only some of the specific regulations listed in RCW 48.30.015 (5).” Thus, violations of the RCW will provide for additional evidence to be considered in regards to the unreasonable actions of the insurance company,.

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