Tort Reform 2004: A Call for Action

Article excerpt

In January, the U.S. Senate leadership cast this year's legislative agenda and recognized class action litigation overhaul, pension legislation, firearms manufacturers' liability and medical liability damage limits as the major issues that need to be addressed this year.

This has presented a unique opportunity for RIMS to take action against a legal environment that is costing the economy billions of dollars annually and is forcing many companies out of business. Because this is an election year, because the current Congress is controlled by a single party, and because the Congressional leadership expects tort reform to become a major policy issue, it is all the more urgent for us to take action now.

Last May, RIMS issued a Statement of Principles on Tort Reform and presented it to our leaders on Capitol Hill during the June 2003 RIMS on the Hill event. The groundwork was laid and debate engaged. The discussions were widely varied, from obstinately opposed to boisterously in favor and every perspective between. Ultimately, the asbestos liability negotiations broke down, the medical liability limitation effort went askew and class action reform was bantered about without resolution.

This is not to say that RIMS' efforts were to no avail. In 2003, 25 states enacted some form of tort reform and nine states enacted medical liability reform. But that is only an opening skirmish in a wider battle, and our efforts need to be fully focused on Washington from now until Congress breaks for recess in August. RIMS' Statement of Principles is as relevant today as it was last June in Washington. Tort litigation costs continue to increase by double digits annually. The American Tort Reform Association has shown that annual tort costs now exceed $233 billion, or more than $810 per U.S. citizen. What is more, that figure is projected to grow each year until something is done about it.

All too often, Washington belatedly reacts to an economic crisis, usually for a specific special interest or industry. How do we, as risk management professionals, convey the fact that a genuine crisis is not only upon us, but must be dealt with immediately? …


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