Karl Herrmann, Former State Insurance Chief, Dies

Former state Insurance Commissioner Karl Herrmann, a tough consumer advocate in the Legislature as well as in the insurance department, has died from complications of diabetes. He was 81.

As insurance commissioner, Mr. Herrmann got national attention by developing the Personal Injury Protection Program, which forced insurance companies to pay partial claims before a case is entirely settled.

He also developed the Washington Guarantee Fund, the first in the nation. The fund required all insurance companies to jointly pay off policyholders of companies that went bankrupt in the state.

Mr. Herrmann, a lifelong Democrat, was elected insurance commissioner in 1968, after 12 years of representing Spokane in the state Senate. When he stood for reelection as commissioner in 1972, he became the first person in state history to garner 1 million votes.

During his term as chairman of the Senate Committee on Banks, Financial Institutions and Insurance, Mr. Herrmann was instrumental in ending the practice of “redlining,” according to a son and law partner, Charles Herrmann of Gig Harbor.

Insurance companies had previously refused to write policies in what they considered ethnic ghettos. That, in turn, prevented people in those neighborhoods from getting home loans. The term came from the red lines drawn on maps to define the neighborhoods.

Mr. Herrmann was born in Granite Falls and grew up in Leavenworth. Recently, he was a senior legal counsel for the Tacoma-Seattle law offices of Herrmann and Associates, operated by his son.

The father and son teamed with noted San Francisco attorney Melvin Belli to win a settlement from Korean Airlines for 89 relatives of passengers aboard KAL’s flight 007, which was shot down in 1983 after straying into Soviet airspace.

Mr. Herrmann died Monday. He is survived by his wife, Beatrice; daughter Gretchen Johnson of Seattle; sons Karl of Spokane, Charles of Gig Harbor and James of Seattle; and 11 grandchildren.

Services will be at 2 p.m. Friday at Mountainview Funeral Home in Tacoma. In lieu of flowers, the family requests donations be made to the Diabetes Foundation.