Maurice Langston: Tort Reform Is Starting to Work

Op-ed views and opinions expressed are solely those of the author.

Financial safety at all levels is especially important to hundreds of thousands of Florida’s retirees who are dependent upon fixed incomes derived from pension plans or social security. Of particular interest to them are financial scams or increases in fixed costs like taxes or fees. Just a moderate increase in a fixed cost can significantly impact their quality of life. One hidden fee that has impacted them in Florida over the last couple of decades has been the tort tax, a major contributor to the rise of insurance costs.

In short, the tort tax is simply the added financial burden on every produced good or provided service due to frivolous lawsuits. Almost every time a plaintiff sues someone for anything, the defendant’s insurance company gets involved. In Florida, our legal system rewards plaintiff attorney’s their fees from defending insurance companies even if those fees are massively out of proportion to the amount of money in dispute. For instance, a simple fender bender with a lawsuit for $50,000 in damages could have an attached legal bill for $100,000 for “casework.” If the insurance company settles for any amount in damages, the full legal bill for the defendant becomes due. That kind of system rewards the aggressive attorney who files more lawsuits and has led to the massive amount of plaintiff lawyer money spent on advertising encouraging people to file a lawsuit for anything, promising no fees without a win, and making it sound like a guaranteed windfall.

Furthermore, an insurance company can build predictable liability models for almost every kind of risk, but the way that Florida’s lawsuit system has been working defied all of those models and has been the most significant reason why rates have skyrocketed and insurance companies have closed their doors.

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In today’s economy, where insurance is required in many instances, the effect of a pinched insurance market causes every other price to rise. Most understand that it may affect home purchase prices or commercial and residential rentals. But it also affects the cost of groceries, restaurant meals, hair and nail services, lawn services, gasoline, and the list goes on and on. If one frivolous lawsuit is filed, an insurance company can deal with it without it affecting the overall pool of rate-payers that the company provides insurance for. If thousands of frivolous lawsuits are filed, the cost of insurance must go up, and that cost is going to be borne by consumers at the end of the line.

That’s why the 2023 Florida legislature did the right thing by addressing lawsuit abuse in the most comprehensive tort reform package in Florida’s modern history. That package should begin to flatten insurance rate increases and provide consumer relief across the board. In fact, that alone may be responsible for decreasing inflation in the state of Florida. With that being said, rumors are afoot that the bad-acting attorneys who enjoyed their decades-long lawsuit ATM are attempting to push back in the upcoming legislative session.

We need to take a patient approach to the reform package and let it work before changing anything. Moreover, there are probably still some areas that need to be addressed. But at a minimum, we need to encourage our legislators to remain confident and let the market catch up. Because of the hard work done in 2023, Florida’s consumers in 2024 may have their Happiest New Year yet.

By Maurice Langston

The Florida Council for Safe Communities


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