WASHINGTON COURT DISMISSES BAD FAITH AND IFCA CLAIMS WHEN INSURED DID NOT PROPERLY OR TIMELY DISCLOSE ALLEGED DAMAGES TO UIM INSURER

On May 11, 2016, Judge Richard A. Jones for the United States District Court for the Western District of Washington rendered an important decision limiting an insurer’s potential liability for bad faith and violations of Washington’s Insurance Fair Conduct Act (IFCA) arising from its handling of an Underinsured Motorist (UIM) claim. The Court found that when the insured has not fully and adequately advised the insurer of the extent of their damages, the insurer cannot be liable for bad faith or IFCA violations when the insurer makes a reasonable settlement offer based on the information provided by the claimant during the claim investigation.

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