For 20 years, Texas has stood on the forefront of common-sense lawsuit reform aimed at ensuring our courts are used for justice, not greed.
Over the years, those changes have included reining in outrageous damage awards, court shopping and out-of-state asbestos lawsuits that had nothing to do with Texas.
These and other reforms have allowed the state to shed its reputation as the nation’s poster child for lawsuit abuse.
As last year’s hailstorm lawsuit reform law marks its one-year anniversary, we once again see Texas solidifying its reputation as a national leader in stopping questionable legal practices.
In the case of hailstorm lawsuit reform, it was Rio Grande Valley Citizens Against Lawsuit Abuse (RGVCALA) that first uncovered signs of abuse in our courts. Their landmark 2014 study found that half of all hailstorm lawsuits were filed in the two-month period of March-April 2014, as the statute of limitations neared for insurance disputes from the Hidalgo County hailstorms.
In fact, between April 1, 2012 and April 30, 2014 a total of 5,740 hailstorm cases were filed in Hidalgo County. And, of those cases, 2,513 were filed in March and April of 2014, meaning just under half of all the Hidalgo County hailstorm cases were filed in the final two months of the period reviewed. The study also examined lawsuit courthouse filings and revealed that this rush to the courthouse involved only a small number of law firms.
Passage of reforms to weather-related lawsuits became a priority for the Texas Legislature in 2017. The law that was passed and took effect just one year ago preserves access to our courts for legitimate claims.
The new law limits lawsuit abuse by giving insurance companies 60 days to resolve a claim before being taken to court. It also preserves Texas homeowners’ right to sue, while ensuring that natural disasters aren’t used for financial gain driven by personal injury lawyers.
And, the reforms preserve some of the nation’s strongest consumer protections against insurers that unfairly deny or delay weather-related claims.
The bottom line is the normal insurance claims process has not changed, and a homeowner’s ability to file suit and receive full damages for unpaid claims does not change with this new law either.
So, has it worked?
The numbers speak for themselves.
According to property and casualty insurance lawsuit data compiled by Texans for Lawsuit Reform, prior to the passage of hailstorm lawsuit reform (between Jan. 1, 2014 and Aug. 31, 2017), over 34,000 weather-related suits were filed, including a spike of 1,553 lawsuits in August 2017, filed just prior to the new lawsuit reform law taking effect.
Available data for the first four months after the hailstorm reforms took effect shows an average of only 85 weather-related lawsuits filed each month.
Weather-related lawsuits are down to levels not seen since 2012.
Hailstorm lawsuit reform was designed to discourage unscrupulous personal injury lawyers, adjusters and contractors from preying on Texans impacted by weather-related events. One year in and we’ve seen it working and that’s good news for all Texans – except for greedy personal injury lawyers.
Sergio Contreras is leader of the Rio Grande Valley Citizens Against Lawsuit Abuse and President and CEO of the Rio Grande Valley Partnership.