The bill amends existing laws regarding the duties of self-insured employers and third-party administrators in the context of industrial insurance. Key changes include the criteria for withdrawing certification from self-insurers, specifically that a self-insurer can lose certification if they violate their duty of good faith and fair dealing three times within a three-year period, as defined under RCW 51.14.180. The bill clarifies that errors or delays that are minor or inadvertent do not count as violations. Additionally, it allows the director to delay the withdrawal of certification if the self-insured employer has a binding contract with a licensed third-party administrator.

Furthermore, the bill establishes a clear duty of good faith and fair dealing for all self-insured employers and their third-party administrators, emphasizing fair treatment of workers. It mandates the department to investigate complaints of violations and outlines the process for issuing penalties for confirmed violations. The act applies to all claims regardless of the date of injury and is set to take effect on January 1, 2026.

Statutes affected:
Original Bill: 51.14.080, 51.14.180