In February the Supreme Court of Washington handed down its first major decision on the Insurance Fair Conduct Act (“IFCA”): Perez-Crisantos v. State Farm. The Court’s narrow ruling—that IFCA claims cannot be based on technical violations of non-substantive sections of the Washington Administrative Code—is a Pyrrhic victory for insurers. Though this ruling superficially limits the scope of IFCA, the Washington Supreme Court simultaneously announced that violations of substantive sections of the Washington Administrative Code are the equivalent of an unreasonable denial of claim and, therefore, actionable under IFCA. As a result, depending on the violation of the Washington Administrative Code, a policyholder’s IFCA claim may actually be stronger as a result of the Perez-Crisantos v. State Farm decision.
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