AIA Backs New Missouri Tort Reform Law HB 393

March 30, 2005

The American Insurance Association (AIA) on Tuesday said that the tort reform legislation (HB 393) just enacted in Missouri is a fair and balanced solution to the state’s growing liability problems.

“This measure balances the needs of businesses to operate in a commonsense legal environment with the rights of consumers to seek redress when wronged,” said Steve Schneider, AIA vice president, Midwest region. “Gov. Matt Blunt (R) and the legislature tackled a tough issue and put together a bill that is fair to all parties, which should greatly improve the state’s liability climate.”

HB 393 is a comprehensive tort reform measure that includes the following reforms:

• Limits punitive damages to $250,000 or three times the net amount of the judgment awarded the plaintiff against the defendant, whichever is greater;
• Lowers the cap on non-economic damages that can be recovered against health care providers to $350,000 (not adjusted for inflation), irrespective of the number of defendants;
• Strengthens venue rules for in-state and out-of-state causes of action for plaintiffs and defendants, both corporate and individual;
• Eliminates joint and several liability, and specifies that the liability of each defendant who is found to be 50 percent or less at fault is subject only to that percentage of the judgment; and
• Specifies that interest calculations for pre- and post-judgment claims be based on the federal funds rate plus a specific percentage, depending on the case.

“This legislation will ensure a more stable and predictable legal system in Missouri, and that means a more attractive state to small businesses and physicians, two groups most often negatively affected by a broken liability system,” added Schneider.

A House-Senate conference committee passed a compromise version of HB 393 on March 16. Gov. Blunt went to Springfield, Joplin, Cape Girardeau and Kansas City on Monday to perform ceremonial signings of the bill, which has been the Republican Party’s top priority for three years.

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