My Apple Watch is not an option for filling in passwords in safari. I have reviewed the settings and all appears correct. What am I missing?
MacBook Pro 13", macOS 10.15
As deggie has said, that Watch function is only for unlocking your MacBook. If you wish to use fills in Safari, one would use Keychain, or another password manager.
It seems I am missing the question. You do not have Safari on the Apple Watch, and the Apple Watch is not where you would store passwords.
OK - I appreciate your help. I assumed from this article on Apple's site that it could do the safari passwords like the Touch ID does ...
How to approve other password requests
You can also use your Apple Watch to approve other requests to enter your administrator password. This feature requires watchOS 6 and macOS Catalina. It works anywhere you need to type your Mac password, such as when viewing passwords in Safari preferences, unlocking a locked note, approving an app installation, or unlocking settings in System Preferences.
For example, when you click the lock 
to make a change in System Preferences, your Mac prompts you to approve with Apple Watch or Touch ID:
Thanks again for your help
Sorry for not explaining it correctly. On my MacBook Pro, when it requires a password to sign in, it will use my Apple Watch instead of requiring fingerprint or typing in the password. However, it is “not” allowing the Apple Watch as an option any other time - including filling in Safari Passwords or signing in after restarting.
The only function the Apple Watch provides is unlocking the local computer passcode, it has no means to unlock websites.
Apple Watch to fill in Safari Passwords
