Florida’s New Tort Reform: Unintended Consequences for Injured Plaintiffs
In March 2023, Governor Ron DeSantis signed into law a series of tort reform measures under House Bill 837 (HB 837), significantly altering Florida’s civil litigation landscape. These changes, which took effect on March 24, 2023, aim to lower insurance premiums and create a more predictable legal environment for businesses. However, despite the potential benefits for insurance companies and defendants, the reforms are likely to have significant negative consequences for injured plaintiffs, particularly those involved in personal injury cases.
This article will explore how the new legislation, while addressing insurance cost concerns, may inadvertently harm plaintiffs seeking fair compensation for their injuries. The reforms, which include changes to comparative negligence rules, caps on noneconomic damages, and adjustments to attorney fees, have made it harder for plaintiffs to recover the full scope of their losses. Additionally, Florida’s failure to update its mandatory bodily injury (BI) insurance limits in light of inflation and rising medical costs compounds the impact of these reforms, leaving injured parties with inadequate protection.
Key Provisions of HB 837 and Their Implications
HB 837 was passed as a part of broader efforts to curb litigation costs and limit what proponents of the reform viewed as excessive payouts in personal injury cases. The law introduced several key changes to the civil litigation process, which now significantly affect plaintiffs in Florida.
Modified Comparative Negligence: One of the most significant changes introduced by the new tort reform is the shift from a pure comparative negligence system to a modified comparative negligence standard. Under the previous system, plaintiffs could recover damages even if they were found to be 99% at fault, although their recovery would be reduced by their percentage of fault. The new system bars recovery entirely if a plaintiff is found to be more than 50% at fault. This is a drastic shift that affects plaintiffs in cases where liability is shared among multiple parties.
In practice, this means that many injured individuals may be left without any recourse if they are deemed to have played even a slightly greater role in causing the accident. For example, in complex accidents involving multiple vehicles, it is common for fault to be split among several parties. Under the new law, plaintiffs who are just over 50% at fault—even in cases where they have suffered severe injuries—will be barred from recovering damages.
Caps on Noneconomic Damages: The reform also introduced caps on noneconomic damages, which cover pain and suffering, mental anguish, and loss of enjoyment of life. These damages are particularly important in cases where the injured party has sustained long-term or permanent injuries that cannot be fully compensated by economic damages alone. The new limits restrict the amount plaintiffs can recover for these intangible, yet often life-altering, consequences of their injuries.
Noneconomic damages are vital in ensuring that plaintiffs are adequately compensated for the emotional and psychological toll of their injuries, particularly in cases of catastrophic injury or wrongful death. By capping these damages, Florida’s reform effectively limits compensation for victims who may require ongoing care, face permanent disability, or experience significant psychological trauma.
Changes to Attorney Fees: Another key provision of the new law limits attorney fees in certain types of cases. Proponents argue that this is necessary to prevent excessive litigation and reduce the incentive for attorneys to take on frivolous cases. However, in practice, limiting attorney fees can make it more difficult for injured plaintiffs to find representation, particularly in complex or high-risk cases.
Personal injury attorneys typically work on a contingency fee basis, meaning they only get paid if their client wins the case. By capping the fees that attorneys can collect, the law disincentivizes attorneys from taking on cases where the potential damages are relatively low but the legal work required is extensive. As a result, injured plaintiffs may struggle to find representation in cases that would otherwise be viable, leading to a potential denial of access to justice.
Reduced Liability for Insurance Companies: Insurance companies stand to benefit significantly from these reforms. By limiting noneconomic damages and changing the comparative negligence rules, insurance companies will likely see a reduction in the size of settlements and jury awards. This is expected to result in lower payouts, which could, in theory, lead to lower insurance premiums for consumers. However, history has shown that there is little evidence that tort reform directly results in lower premiums. In fact, many states that have implemented similar reforms have seen little to no reduction in insurance costs for consumers, calling into question whether these reforms will have the intended effect.
Failure to Address Inadequate Bodily Injury Limits
While the new tort reform measures were introduced with the goal of reducing litigation costs and insurance premiums, they fail to address a significant issue in Florida’s insurance system: outdated bodily injury (BI) liability limits. Florida continues to require minimum BI coverage of only $10,000 per person and $20,000 per accident, which is among the lowest in the nation. These limits, set decades ago, are woefully inadequate given the rising costs of healthcare and inflation.
To put this in perspective, the average cost of a hospital stay for a moderately severe injury can easily exceed $50,000, not including ongoing care, rehabilitation, or lost wages. With BI limits as low as $10,000, injured plaintiffs are often left with substantial unpaid medical bills even after receiving the maximum insurance payout from the at-fault party. In other states, minimum BI coverage limits are much higher—California, for example, requires $15,000 per person and $30,000 per accident, while many states require even more.
Despite inflation and the rising cost of healthcare, Florida’s legislature has not made any efforts to raise the mandatory minimum limits for BI insurance. As a result, even plaintiffs who succeed in securing a judgment or settlement may not receive enough compensation to cover their actual medical expenses, much less the noneconomic damages associated with their injuries.
The Importance of Updating BI Limits
In the context of tort reform, raising Florida’s BI limits is crucial to ensuring that injured individuals are adequately protected. Increasing the minimum required coverage would not only help accident victims recover a fairer amount but would also reduce the number of personal injury cases that go to trial due to insufficient insurance coverage. Many plaintiffs are forced to file lawsuits because the at-fault party’s insurance coverage is inadequate to cover the cost of their injuries. If insurance limits were increased, more cases could be resolved through settlement, reducing the overall burden on the court system.
Raising BI limits would also bring Florida in line with other states and reflect the economic realities of modern healthcare costs. Medical bills, rehabilitation costs, and lost wages have all risen significantly over the past few decades, and it is time for Florida’s insurance laws to catch up. Without an increase in BI limits, the reforms implemented under HB 837 will do little to alleviate the financial burden on plaintiffs, and insurance companies will continue to offer minimal protection while reaping the benefits of reduced liability.
A More Balanced Approach to Reform
While the intention behind Florida’s new tort reform is clear—reduce litigation and lower insurance costs—it misses the mark in providing a fair and just system for plaintiffs. The modifications to comparative negligence, caps on noneconomic damages, and limits on attorney fees tilt the scales too far in favor of insurance companies and defendants, leaving injured individuals without sufficient recourse.
A more balanced approach to tort reform would focus not only on reducing litigation costs but also on ensuring that injured individuals are adequately compensated. This could be achieved by:
Increasing BI Insurance Limits: As discussed, raising the minimum BI limits is essential for ensuring that plaintiffs are protected from financial ruin following an accident. This would provide more comprehensive coverage and reduce the need for litigation over insufficient payouts.
Targeted Reforms to Address Frivolous Lawsuits: Instead of sweeping changes that affect all plaintiffs, the legislature could focus on specific reforms aimed at curbing frivolous lawsuits. This could include stricter requirements for filing claims, penalties for attorneys who bring meritless cases, and increased judicial oversight of case merits.
Ensuring Access to Legal Representation: Reforms should consider the impact on access to legal representation, particularly for low-income individuals and those involved in complex cases. Limiting attorney fees may reduce the availability of competent representation, ultimately undermining the goal of a fair legal system.
Conclusion
Florida’s tort reform measures under HB 837 represent a significant shift in the state’s legal landscape, with the goal of reducing litigation costs and lowering insurance premiums. However, these reforms come at the expense of injured plaintiffs, who now face greater hurdles in securing fair compensation. The changes to comparative negligence, caps on noneconomic damages, and limits on attorney fees create an environment that favors insurance companies and defendants while leaving many plaintiffs without adequate recourse.
Moreover, the failure to address outdated BI insurance limits means that even successful plaintiffs may be left with insufficient compensation to cover their medical expenses. To create a more just and balanced system, Florida must consider raising its minimum BI limits and implementing reforms that preserve access to legal representation for all individuals, ensuring that tort reform does not come at the cost of fairness and justice.
Matthew Rubner