-
The Changing Liability Landscape
Jun 12, 2009 | 21st Century Business, Business, Finance, Government Policy, Risk Management No comments yetThe 2009 liability landscape is in for some changes with a new administration, a reshaped Congress and a deteriorating economy. The bad economy has given lawmakers a green light to letting Government fix all of our ills. Tort Reform of the last few years appears to be giving way to a new perspective on corporate liability. Signs are everywhere showing the pendulum is swinging against business again.
The Insurance Information Institute has recently produced a whitepaper, The Tort Threat, detailing future trends in U.S. tort law.
Tillinghast identifies the following issues that it expects to determine future tort costs.
- Gasoline prices – The increase in the price of gasoline resulted in a decrease in miles driven in 2008. Whether the public’s reaction to the price is a temporary or permanent shift in driving habits will have an impact on future personal auto liability costs.
- The credit crunch and subprime loan crisis – Fallout from the crisis has led to significant ongoing litigation activity particularly on a class action level. Government involvement in financial firms will undoubtedly lead to further litigation going forward.
- Medical malpractice – Tort costs from medical malpractice claims have decreased in inflationadjusted dollars since 2004, due in part to tort reforms at the state level. However, some of these reforms have been overturned or are currently being challenged in the courts
- Options backdating – While significant settlements have been made to resolve allocations of improper options backdating, this category of tort costs may have peaked.
- Employment practices liability (EPL) – Recent battles on EPL issues related to whistleblower retaliation, compliance with the Fair Labor Standards Act, etc, have been won by the employee side which could trigger additional activity in this area.
- Products liability suit restrictions – The March 2009 U.S. Supreme Court decision in Wyeth v. Levine that Food and Drug Administration (FDA) approval of a drug warning label does not shield the manufacturer from state lawsuits may lead to a shift in product liability litigation.
- November 2008 elections – The change in administration and potential shifts in the U.S. Congress may lead to modifications in the federal government’s behavior and attitudes towards commercial litigation.
-
Other emerging issues – Global warming and obesity continue to be potential areas for
significant tort costs. Claims related to data security breaches have also surfaced.
Tags:
This entry was posted on June 12, 2009 at 12:38 pm
You can follow any responses to this entry through the Comments RSS .
