On Friday, June 14, 2019, the Kansas Supreme Court ruled (4-2) that our state’s cap on damages for non-economic injuries such as pain, suffering, mental anguish and loss of enjoyment of life following an injury is unconstitutional. This major development has the potential to impact every industry, profession and individual.
How This Affects You
Kansas businesses and organizations have long enjoyed a predictable tort environment, the foundation being our cap on non-economic damages.
As your Risk Consultants, we assert that caps on damages are absolutely essential in protecting many components of our society from the crushing costs of unreasonable jury verdicts.
In short, damage caps keep insurance costs down for consumers, acting as a safeguard against “runaway juries” that award huge verdicts.
What Others Are Saying
State Senator Rick Wilborn, R-McPherson and chair of the Senate Judiciary Committee says its too soon to predict how the legislature will respond to this decision. “Those caps were put on years ago to control costs in the insurance arena, to put some predictability back in insurance rates,” he said. “And any time to add to loss cost, you can anticipate in time as the awards mount that insurance rates will increase. It’s that simple.”
Joe Rosell, Executive Director of Kansas Medical Society, says the group believes this ruling affects malpractice cases and will likely increase doctors’ insurance costs, which will ultimately increase consumer costs. These higher costs could also make it too expensive for doctors to practice in rural areas. “We think that this decision begins a series of dominos that will fall where ultimately the Kansas patient will be impacted,” he said.
In the 1980s, the legislature imposed the caps because it was feared that liability insurance was too costly. “Now,” says Rosell, “It appears that we’ll be returning back to that era.”
The Kansas Chamber of Commerce Chief Executive Alan Cobb voiced his displeasure with the decision in a statement, “For Kansas businesses, this creates great uncertainty and could force them to close their doors and lay off employees because of one frivolous lawsuit. The economic domino effect of that would be disastrous for Kansas families and their communities. This decision also puts Kansas at a competitive disadvantage with states who do limit non-economic damages.”
Custom Risk Management
Our very existence is rooted in our commitment to be a trusted advisor for your business or family. Depending on your business focus or asset profile it may be time to discuss your Umbrella or Excess Liability coverage need. With consultation, education and proactive planning, our team will continue to partner with you to create customized risk management strategies for you and your business. Please don’t hesitate to reach out if we can be of immediate assistance.
