New Class Actions Allege Failure to Pay Winters Fees

A Seattle law firm recently filed similar class action lawsuits against two insurance companies. Each suit alleges that the insurer failed to pay its share of the legal expense incurred by the insured in recovering amounts paid by the insurer as personal injury protection (PIP) benefits from a third party who was insured by the same insurer. In both cases, the plaintiff was a passenger in the insured vehicle and therefore was an "insured" under the driver's policy for PIP purposes. The passenger sued the driver and received a settlement, from which the insurer took an offset of its PIP payments without deducting a proportionate share of the plaintiff's legal expense. This practice allegedly violated the Washington Consumer Protection Act. Bad faith, conversion, and breach of contract are also alleged. As a general rule, an insurer that receives reimbursement for medical payments is obligated to pay a pro rata share of the legal expenses incurred by the insured. See Winters v. State Farm Mutual Automobile Ins. Co., 144 Wn.2d 869 (2001).