Washington Fines USAA, Allstate $230,000 as New Claims Rules Take Effect

New insurance claims rules in Washington state require insurers to explain disputed repair costs and respond more quickly to auto glass repair shops.

The changes took effect October 18, less than three weeks after Insurance Commissioner Patty Kuderer announced $230,000 in fines against USAA and Allstate for insurance violations.

USAA Casualty Insurance Co. was fined $140,000 for unfair or deceptive practices involving auto claims. Allstate Vehicle and Property Insurance Co. was fined $90,000 for claims-handling violations and for failing to comply with the state’s premium change transparency rule.

“We take our role as a consumer protection agency seriously,” Kuderer says. “These orders, and the actions we’ve taken against insurers for failing to meet their obligations to policyholders when processing their claims, are a testament to that work.”

What the New Rules Mean for Auto Glass Shops

Neither case involved auto glass-specific violations. Allstate’s violations concerned homeowners insurance claims, while USAA’s involved auto claims, primarily collision accidents, according to the Washington Office of the Insurance Commissioner.

Under the updated rules, insurers have five business days to notify customers and their repair shops in writing of what they’ll cover when they receive supplemental damage estimates or final invoices. If they reject additional damage, they must explain why.

For auto glass shops, that could mean getting a clearer answer when additional damage is discovered during a windshield replacement or when an insurer questions a calibration charge.

When Insurers Dispute Repair Costs

Insurers must explain why they pay less than a repair facility’s estimate. The updated rules require them to identify costs they won’t cover and to explain the policy provisions that support their decisions.

Customers can request a written explanation of how the insurer determined labor costs, material costs and repair procedures. That could help explain differences between an insurer’s estimate and the shop’s charges.

Insurers must also consider additional damage discovered during repairs. Their estimates must be prepared by someone qualified to evaluate the work, and insurers are responsible for the accuracy of their repair documentation.

More Options for Shops and Customers

Insurers can’t require shops to use only an online application to submit claims information. Shops must have the option of submitting documents by email, regular mail, fax or in person.

Customers who disagree with an estimate based on photographs or a virtual inspection can request an in-person inspection. Insurers must generally complete it within five business days unless another time is agreed upon.

The insurance commissioner’s office says the changes should also help repair shops by improving communication and increasing transparency in how insurers determine repair costs.

Auto glass professionals who believe an insurer isn’t following Washington’s claims handling standards can file a complaint with the Office of the Insurance Commissioner.

The rules don’t require insurers to approve every repair or pay every amount a shop requests. But they do establish deadlines for responding to additional repair costs and require clearer explanations when insurers disagree with repair estimates.

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