Louisiana insurance companies and businesses have long had concerns about lawsuit awards after motor vehicle accidents. While there is no doubt people who have been injured or lost a loved one in a crash have the right to seek compensation, the amounts are often far greater than what is considered reasonable in the context of the damages suffered. To address this issue, a new law was signed to limit potential awards. Understanding how this impacts a case is imperative as is legal advice to defend a lawsuit.

The law came about as part of a negotiation between the governor, the state legislature and industry lobbyists. Those who pressed for the bill to be passed say insurance rates will be reduced. Louisiana’s insurance rates are second in the U.S. in terms of cost. Those who opposed the legislation say people who have been hurt in a crash will be constrained in seeking fair compensation and it can harm their attempts to have medical costs covered. This could also make it more expensive for the courts.

Supporters of the bill expect a reduction in the number of filings for auto accidents and that it will lower award amounts. Lawsuits for accidents in which there is little damage and the injuries are questionable is a longstanding problem across the nation. Businesses and insurers face problems after massive payouts. There will be more jury trials instead of decisions made by a judge because the jury trial threshold was reduced to $10,000 from $50,000. Insurance coverage will be mentioned less as this tends to give jurors the impetus to give higher awards. It will put a maximum amount for which medical expenses can be awarded. Information as to whether seatbelts were worn will be allowed as evidence.

After motor vehicle accidents, the focus is generally on those who were hurt. This is understandable, but it is only part of the picture. Insurers and businesses who are being sued need legal help to protect their interests. This new law is an effort to keep awards in line with what is reasonable. Defending against lawsuits can limit the damage or prevent payouts in cases where they are unwarranted. Consulting with a firm that has experience in defending these entities when they are sued after a crash can be critical to a successful outcome.