Washington Administrative Code › Title 284 - Insurance Commissioner, Office of the › Chapter 284-30 - Trade practices › THE UNFAIR CLAIMS SETTLEMENT PRACTICES REGULATION › Section 284-30-391 - Methods and standards of practice for settlement of total loss vehicle claims

Current through Register Vol. 24-14, July 15, 2024
Unless an agreed value is reached, the insurer must adjust
				  and settle vehicle total losses using the methods set forth in subsections (1)
				  through (3) of this section. Subsections (4) through (6) of this section
				  establish standards of practice for the settlement of total loss vehicle
				  claims. If an agreed value or methodology is reached between the claimant and
				  the insurer using an evaluation that varies from the methods described in
				  subsections (1) through (3) of this section, the agreement must be documented
				  in the claim file. The insurer must take reasonable steps to ensure that the
				  agreed value is accurate and representative of the actual cash value of a
				  comparable motor vehicle in the principally garaged area.
(1) Replacing the loss vehicle: The insurer
				may settle a total loss claim by offering to replace the loss vehicle with a
				comparable motor vehicle that is available for inspection within a reasonable
				distance from where the loss vehicle is principally garaged.
(2) Cash settlement: The insurer may settle a
				total loss claim by offering a cash settlement based on the actual cash value
				of a comparable motor vehicle, less any applicable deductible provided for in
				the policy.
(a) Only a vehicle identified as
				a comparable motor vehicle may be used to determine the actual cash
				value.
(b) The insurer must
				determine the actual cash value of the loss vehicle by using any one or more of
				the following methods:
(i) Comparable motor
				vehicle: The actual cash value of a comparable motor vehicle based on current
				data obtained in the area where the loss vehicle is principally
				garaged.
(ii) Licensed dealer
				quotes: Quotations for the cost of a comparable motor vehicle obtained from two
				or more licensed dealers within a reasonable distance of the principally
				garaged area not to exceed one hundred fifty miles (except where there are no
				licensed dealers having comparable motor vehicles within one hundred fifty
				miles).
(iii) Advertised data
				comparison: The actual cash value of two or more comparable motor vehicles
				advertised for sale in the local media if the advertisements meet the
				definition of current data as defined in WAC
				284-30-320(4).
				The vehicles must be located within a reasonable distance of the principally
				garaged area not to exceed one hundred fifty miles.
(iv) Computerized source: The insurer may use
				a computerized source to establish a statistically valid actual cash value of
				the loss vehicle. The source used must meet all of the following criteria:
(A) The source's data base must produce
				values for at least eighty-five percent of all makes and models for a minimum
				of fifteen years taking into account the values of all major options for such
				motor vehicles.
(B) The source must
				produce actual cash values based on current data within a reasonable distance
				of the principally garaged area, not to exceed one hundred fifty
				miles.
(C) The source must rely
				upon the actual cash value of comparable motor vehicles that are currently
				available or were available in the market place within ninety days prior to or
				after the date of loss.
(D) The
				source must provide a list of comparable motor vehicles used to determine the
				actual cash value. If more than thirty comparable motor vehicles are located,
				the insurer need list only thirty but may list more.
(v) Cash settlement search area: If none of
				the methods in subsection (2)(b)(i) through (iv) of this section produce a
				comparable motor vehicle to establish an actual cash value within a reasonable
				distance of the principally garaged area, the search area may be expanded in
				increasing circles of twenty-five mile increments, up to one hundred and fifty
				miles, until two or more comparable motor vehicles are located. If no
				comparable motor vehicles can be located within one hundred fifty miles, the
				search area may be expanded with the agreement of the first party
				claimant.