Georgia is poised for significant changes in its legal landscape as Governor Brian Kemp introduces a comprehensive tort reform package aimed at addressing rising insurance costs. However, critics argue that these reforms will primarily benefit insurance companies and believe the changes could limit individuals' ability to seek fair compensation.
Why It Matters
Georgia, like many states, is grappling with escalating insurance premiums. For example, auto insurance rates in the state surged by 21 percent last year, according to a report from Insurify. This outpaces the national average by 22 percent. Homeowners' insurance rates have also seen a sharp rise due to factors such as increased repair costs and a higher frequency of claims.
Governor Kemp's proposed reforms aim to mitigate these rising costs by overhauling the state's tort laws, potentially influencing how businesses operate and how consumers seek redress through the legal system. However, some experts argue that these reforms could disproportionately benefit insurance companies over consumers.
What To Know
In a January 30 press release, Kemp unveiled his "plan to tackle tort reform and stabilize insurance costs for hardworking Georgians." This package aims to limit business liability to what they can directly control, cap damages to actual medical expenses and prohibit anchoring tactics in closing arguments.
Additionally, the reforms include bifurcated trials to establish liability before assessing damages, restrict plaintiffs from dismissing and re-filing cases mid-trial and bring transparency and restrictions to third-party litigation funding.
The tort reform package includes key proposals aimed at improving the state's litigation environment, including:
Re-evaluating business liability: This aims to limit businesses' liability for crimes committed on their property by third parties. Businesses would only be held accountable for incidents they could reasonably control, such as adequate lighting and security measures.
Limiting compensation to actual medical expenses: This proposal seeks to cap damages awarded in lawsuits to the actual out-of-pocket medical expenses incurred by plaintiffs. This means that plaintiffs can only seek damages for the amount they have directly paid or will pay in the future for medical treatment.
Supporters of the reform argue that these changes are necessary to curb frivolous lawsuits and excessive jury awards, which they believe contribute to higher insurance premiums. They contend that a more balanced legal environment will make Georgia more attractive to businesses and help stabilize insurance costs for consumers.
Kemp emphasized the urgency of these reforms, stating, "Our legal environment is draining family bank accounts and hurting job creators of all sizes in nearly every industry in our state." He added that the tort reform package aims to protect the rights of all Georgians, ensuring access to the civil justice system and fair compensation for those who have been wronged.
Opponents caution that the proposed reforms could limit individuals' ability to seek fair compensation for legitimate grievances. In a response emailed to Newsweek, Jason Branch, President of the Georgia Trial Lawyers Association, argues that the proposed tort reform measures will not lower insurance premiums but will instead increase the profits of insurance companies, making it harder for injured Georgians to obtain justice.
Branch emphasizes that insurance premiums are set by insurance companies, which have been raising premiums while recording record-breaking profits. He notes that the insurance industry made around $90 billion in profits in 2023, and 2024 was the most profitable year in modern history for insurance companies. "The proposed tort reform laws now being offered will only serve to further enrich out of state insurance companies."
What People Are Saying
Governor Brian Kemp stated in a press release: "After months of listening to our citizens, businesses, and stakeholders across the spectrum, it is clear the status quo is unacceptable, unsustainable, and jeopardizes our state's prosperity in the years to come. This tort reform package protects the rights of all Georgians to have access to our civil justice system, and ensures that those who have been wronged receive justice and are made whole."
Jason Branch, president of the Georgia Trial Lawyers Association, stated in a response emailed to Newsweek: "Most disturbingly, insurance companies will profit at the expense of innocent Georgians who have suffered injury and harm from the wrongful conduct of others. While the passing of any of these tort reform proposals will not decrease insurance premiums, it is guaranteed that such laws will limit the legal and Constitutional rights of every individual citizen in the state.
The proposed changes in the law are far reaching and wide in scope and at their core seek to limit the liability of wrongdoers in the state and limit all innocent Georgians' right to justice. They do this by changing existing laws and tilting them in favor of Defendants; altering laws and legal principals that have existed for over a hundred years; fundamentally changing how civil trials are conducted and limiting what a jury can consider in deciding a case, and more."
Garrison Douglas, spokesperson for Governor Brian Kemp, told Newsweek: "We welcome them to read the bills. The governor was very clear during his speech that Georgians who are wronged should have every opportunity to pursue their constitutionally-guaranteed day in court and be made whole. This comprehensive and commonsense package protects that right, while banning hostile foreign powers from taking advantage of consumers and legal proceedings, stabilizing insurance costs for businesses and consumers, increasing transparency and fairness, and ensuring Georgia continues to be the best place to live, work, and raise a family."
What Happens Next
The proposed tort reform package will be deliberated in the Georgia General Assembly during the current legislative session. As the debate unfolds, stakeholders from various sectors, including business associations, consumer rights groups, and legal professionals, will weigh in on the potential impacts of the reforms. The outcome of these discussions will determine the future of Georgia's legal landscape and its approach to managing insurance costs.
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