February 19, 2025
OLYMPIA, Wash. — Legislation (Senate Bill 5331) giving Washington’s Insurance Commissioner the authority to order restitution for harmed policyholders was voted out of the state’s Senate Business, Financial Services and Trade Committee today.
Currently, the Insurance Commissioner can fine insurance companies or professionals that violate the law but cannot order them to pay restitution to the people they’ve victimized.
“The Office of the Insurance Commissioner is a quasi-legal and quasi-judiciary agency with our own administrative law judge and law enforcement officers,” said Washington State Insurance Commissioner Patty Kuderer. “It was designed to be a one-stop shop for policyholders. But under the current law, we cannot give people what they really want when they’ve been wronged by an insurance company or individual — their money back.”
Fines collected by the OIC go to the state’s general fund. They do not go to policyholders who were wronged by an illegal actor.
The bill, sponsored by Senator Adrian Cortes (D - Battle Ground) also authorizes the Insurance Commissioner to fine property and casualty insurance companies up to $10,000 per violation, rather than issue a total fine of $10,000. For health insurers, the limit is already $10,000 per violation or offense; SB 5331 would align the two.
Kuderer noted that the bill, and the authority it grants her office, don’t impact reputable insurance companies who agree to pay restitution as a condition of consent orders issued by her office.
“Our office is focused on consumer protection and industry regulation, and the two go hand in hand,” she said. “This bill helps us help protect Washington consumers from bad actors and simplifies the process of making people go to court to get repaid.”
The OIC issued $1.86 million in fines last year and has collected a total of $42.3 million in fines since 2001 that was sent to the state general fund.