US to tackle tort costs from both sides

Reinsurance Magazine
Tuesday, February 1, 2005

The cost of the US tort system means it has become a key issue for President Bush's second term - but while a new report says costs continue to rise, others believe inefficient insurance companies are to blame.
The Center for Justice & Democracy (CJD), an organization that is against tort reform and "fights to protect the right to trial by jury and an independent judiciary", argues that the figures say more about the insurance industry than the legal system.
It highlights that the Tillinghast report, states, "the costs tabulated in this study are not a reflection of litigated claims or of the legal system." This, the CJD argues, means the claim that the tort system costs $246bn is a wildly-inflated figure. The CJD goes on to say it considers the figures are generated, "from the wasteful and inefficient insurance industry, even going so far as to include its administrative costs." Tillinghast states, "Our inclusion of such costs has been questioned since those costs are not directly related to the disposition of specific tort claims. We take no position on the efficiency of the insurance industry's administrative expenses."

CJD concludes that it is critical to understand the limitations of the Tillinghast reports because "those advocating taking away consumers' legal rights have long used the reports as a political tool to argue that lawsuits cost the country too much money". Joanne Doroshow, executive director for the Center for Justice & Democracy, says, "Calling this study 'US Tort System Costs' is intellectually dishonest. Tillinghast's figures are so misleading that they are completely irrelevant to any discussion of the civil justice system."
For a copy of the complete article, contact CJ&D

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