Friable Thoughts

Monday, March 28, 2005

A Simple Half-Loaf Asbestos Reform

Even though various senators have expressed hope that they can get a reform bill, the smart money is that the current bill is dead. Not that Congress would listen to one lone blogger, but here's an alternative that is simple and would provide a partial solution to the asbestos litigation crisis.

First, most folks want some sort of medical criteria solution. While that would be very helpful, it is also complicated by the fact that B readers are not the most reliable screeners, especially if they are paid by plaintiff's attorneys. Thus, until they can develop a more reliable screen for medical criteria, Congress probably won't bite on that solution on such short notice.

A simple solution would be to cap non-economic damages of say $1 million or three times economic damages, whichever is greater. There's no need to hire experts to determine who qualifies and hopefully a cap will drive down the settlement values of less serious cases slowing down the drain on insurance reserves.

While plaintiffs' lawyers will howl bloody murder, the basic argument for a damage cap is that the money "saved" by a damage cap is probably going to be paid out to future plaintiffs anyways and not for yachts and golden parachutes for insurance company CEO's. Plus, all economic damages still get paid in full.

Again, this won't "solve" the problem of the frivolous claims. However, it is something a Congressman or Senator can understand and can hopefully drive down the settlement values of the frivolous cases. Plus, it does not foreclose future legislation based on medical criteria or state efforts along those lines.


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