The 2020 legislative session begins at noon on Monday and it is expected to be dominated by “tort reform” and whether lawsuit reform would actually lower auto insurance rates.
Insurance Commissioner Jim Donelon says Louisiana has the highest jury trial threshold at $50,000 dollars, which means a jury will not hear a case unless there are at least $50,000 dollars in damages. He says this allows trial lawyers to judge shop for favorable venues to get the largest payment for their client.
Donelon says Louisiana is one of just 13 states who even have a threshold.
“In the other 37 states everybody is entitled to a jury of their peers, which has always been the bedrock of the judicial system,” said Donelon.
But Real Reform Louisiana executive director Eric Holl says lowering the threshold is just a handout to the business lobby and has nothing to do with auto insurance rates.
“There’s absolutely no proof that tort reform will do anything to lower car insurance rates, the people pushing tort reform can point to a single state that’s enacted tort reform and then seen a drop in auto insurance rates,” said Holl.
Instead of lowering the jury trial threshold, Real Reform Louisiana is backing a series of bills that would end insurance rate discrimination policies in Louisiana that are banned in other states.
“They don’t let insurance companies penalize deployed soldiers for not having insurance while they are overseas, they don’t let insurance companies charge people more after their spouse dies or based on their gender or their education or their credit score,” said Holl.
Those bills are being brought by Alexandria Senator Jay Luneau.
But Donelon says overall rates are set on a state by state basis, and if you carve out one segment of the population.
“Say single women and lower their rates, below what it is actuarially justified and then you increase the costs for the rest of the driving public,” said Donelon.
