Enacts the Omnibus Premium Reduction Act of 2020 (EG SEE FISC NOTE SG EX See Note)
The implementation of HB9 is expected to impact several aspects of Louisiana's civil liability and insurance landscape. By changing the prescriptive period for vehicular accidents, the bill encourages more claims to be brought forward within a longer time frame, potentially leading to more litigation. The reduction in jury trial thresholds may also increase the number of cases tried without a jury, thus altering court dynamics. Additionally, the adjustments regarding medical expenses are likely to prompt insurers to adjust their rates in line with the anticipated savings from reduced claim payouts, with the expectation of a standard decrease of 10% in premiums for impacted coverages.
House Bill 9, known as the Omnibus Premium Reduction Act of 2020, aims to significantly reduce the cost of motor vehicle insurance in Louisiana. The bill proposes several changes to civil law and insurance policies, such as extending the prescriptive period for delictual actions arising from vehicular accidents from one year to two years, and lowering the threshold for jury trials to $5,000 for such actions. Additionally, the bill seeks to limit recoverable medical expenses for plaintiffs to the amounts actually paid by health insurers, Medicaid, or Medicare, rather than the amounts billed, which is intended to reduce insurance premiums.
The sentiment surrounding HB9 appears to be mixed. Proponents of the legislation argue that the changes are necessary to lower insurance costs and curb losses related to motor vehicle accidents. Supporters also believe that these reforms will promote fairness in insurance payouts and reduce burdens on the state’s insurance system. However, critics express concerns that limiting recoverable damages and altering jury trial rights could undermine the rights of injured parties, reducing their ability to seek full justice for their claims. This division illustrates a broader debate on balancing insurance company profitability with consumer protection.
Notable points of contention include the potential impact on claimants’ rights, particularly regarding the language that limits the recovery of medical expenses to what was actually paid rather than billed. This could be perceived as a way to benefit insurers at the expense of claimants who may face significant medical bills. Furthermore, reducing the threshold for jury trials raises questions about access to justice, as it might make it more difficult for individuals to have their day in court for cases perceived as more significant. The alteration of direct action against insurers also generates debate, as it could change how consumers interact with their insurance providers when seeking compensation for damages.