Insurance loophole focus of legislation

OLYMPIA — Lawmakers want to close a loophole in state law that allowed an insurance company to deny paying the medical bills of a woman injured in a car crash the company claimed was intentional.

Farmers Insurance said it wouldn't pay the bills for one of its policy holders, Ethel Adams of Everett, because she was injured in a multicar accident caused when a man tried to run his ex-girlfriend off the road.

Adams was driving alone in her car when she became entangled in the pileup on Aurora Avenue North last March. The man who caused the accident, Michael R. Testa, didn't have insurance. And because the crash wasn't an accident, strictly speaking, Farmers said it wouldn't cover Adams' bills.

Farmers eventually agreed to pay after extensive local and national media coverage of the case last October.

Bills in the House and Senate would define an accident as something that is unexpected from the standpoint of the person covered. That means victims like Adams would be covered even if a crash was intentional.

Dubbed Ethel's Bill, the legislation was requested by state Insurance Commissioner Mike Kreidler, whose office received more letters about Adams' insurance battle than any case he'd seen before.

Under Washington law, insurers are required to cover collisions caused by uninsured drivers only if the accident is unintentional. But Kreidler said that language hasn't prevented insurance companies from covering accidents caused by uninsured motorists who, for example, run a red light.

Last week, insurance-industry representatives testified at legislative hearings in support of the bill.

Mel Sorensen, a lobbyist for the Property Casualty Insurers Association of America, asked lawmakers to add a provision that would require drivers to file a police report if hit by an uninsured motorist.

The bill, HB-2415, must pass through the House Rules Committee, possibly as early as this week, before it can be voted on by state representatives, said Rep. Steve Kirby, D-Tacoma, one of the bill's sponsors.

Karen L. Johnson: 360-236-8169 or karenjohnson@seattletimes.com