Georgia Republicans push to limit lawsuits. But would that keep insurance rates from rising?
Georgia Gov. Brian Kemp is planning to unveil proposals to put limits on lawsuits
ATLANTA — The pitch from Georgia Gov. Brian Kemp is simple: Putting limits on lawsuits will halt rising insurance costs.
The reality, though, is more complicated.
Changes could reduce liability insurance costs for businesses and commercial property owners. The evidence is mixed on whether it would drive large premium reductions for car and other types of insurance. And some researchers say efforts limiting lawsuits, often called tort reform, fattens insurers' profits more than it cuts the price of policies.
“The net impact is that it really improves insurer profitability,” said Tyler Leverty, a business professor who studies risk and insurance at the University of Wisconsin-Madison.
When Kemp unveils his proposals Thursday, the Republican governor is likely to keep leaning on his argument that everyone's insurance rates are increasing because unfair lawsuits are on the rise and juries are awarding excessive damages.
The issue is Kemp’s top priority this year after promising the Georgia Chamber of Commerce he would take action and instead pushed a law to have Georgia Insurance Commissioner John King gather data in 2024.
King said that lawsuits are driving insurance companies to reduce coverage for retail businesses, apartment owners, drivers and others. He said business owners in areas that insurers label as high crime are among those struggling the most. Companies that offer low-income housing have also complained.
“Go down to southeast Atlanta and talk to the small convenience owners having to close because they can’t find insurance,” King said.
Some say there's no evidence that a nationwide litigation crisis is driving high insurance
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