Georgia Tort Reform Expected to Lower Insurance Premiums by 3-5%

Georgia has enacted new tort reform laws, SB68 and SB69, aimed at reducing multi-million dollar insurance payouts related to business liability lawsuits. These reforms are intended to lower insurance costs across multiple sectors by curbing the civil justice system abuses that previously contributed to high premiums. Georgia Insurance and Safety Fire Commissioner John King anticipates that insurers will file for premium decreases of approximately 3 to 5% following the implementation of the reforms.

While the commissioner cannot outright reject rate increases, he pledges rigorous scrutiny of rate filings and loss claims to prevent unjustified hikes. However, some state lawmakers express concerns that the reforms may not directly address premium prices for auto, home, or business insurance. Experts from the Insurance Information Institute caution that any positive impacts from the reform could be offset by external factors such as tariffs increasing manufacturing and repair costs, potentially maintaining upward pressure on premiums.

Additionally, the commissioner emphasizes fostering market competition by encouraging smaller insurers to enter coverage areas that larger carriers currently avoid. Consumer complaint data shows that the office actively recovers funds and levies fines on insurers for contract violations, with Commissioner King advocating for increased fining authority to enhance enforcement. The Georgia reforms draw comparisons to Florida's lawsuit reform impact, which has resulted in stabilizing rates but only modest decreases for policyholders over time.