Vested Interest - July 2002 Issue

The President’s Thoughts

Remember the little girl in the movie "Poltergeist" who, with wide eyes, exclaimed, "They’re here." Well, it’s here. It’s that time of the decade. Insurance companies are losing millions, so there must be a tort litigation crisis. Doctors won’t be able to practice medicine; girl scouts will no longer sell cookies; the economy will be irrevocably debilitated; little leagues and soccer teams will be cancelled; and add a new admonition, high schools won’t have principals. The demise of all of these icons of American life can be traced to the nefarious designs of trial lawyers whose avarice fuels the litigation explosion and its deleterious impact on society. It is not 1986, the founding year of the ATRA - American Tort Reform Association. It is 2002 and we know the specious nature of all of these myths.

Let us act, not react. We know:

1. Ill-advised insurance company investments and a decade of short sighted price slashing designed to garner huge premium dollars led to industry losses of nearly $3 billion dollars.
2. Study after study that has examined the insurance industry has found that the "insurance crisis" of the 70’s and 80’s, as well as today's, were actually self-inflicted phenomenon caused by mismanaged underwriting practices.
3. There is a virtual absence of empirical evidence that supports a correlation between tort restrictions and the lowering of insurance rates or the expansion of insurance availability. In fact, The Center for Justice and Democracy’s 1999 Study, Premium Deceit - The Failure of "Tort Reform" to Cut Insurance Prices, found that some states that resisted enacting any "tort reform" experienced low increases in insurance rates or loss costs relative to national trends, and some states that enacted major "tort reform," like New York, saw very high rates or loss costs increases. There was, and is, no correlation between "tort reform" and insurance rates.

My message is direct and exhortative: Let’s take the initiative to protect the rights of injured people from this cyclical duplicity. Any member of ITLA who is reading this column can act. In addition to the prodigious and compelling work of the Center for Justice and Democracy in New York and the Coalition for Consumer Rights, articles recently ran in the Wall Street Journal, June 24, 2002, and the Chicago Tribune, June 27, 2002, (Molly Ivins, syndicated columnist) which finally told these truths to a national audience. All of these facts and articles are available to you through ITLA. I urge every member of ITLA to contact your local newspapers, radio stations, television outlets and any other type of media and attempt to stimulate debate on this issue. Challenge the tort reformers to send a representative to support their campaign. Call ITLA if you want me or another member of the board to assist or accompany you.

This is a year of opportunity and participation for all of us. We are done scrambling in response to an insurance industry inspired juggernaut. We shall act.

Robert J. Bingle, President
Illinois Trial Lawyers Association