Truck insurers would be able to avoid being named as defendants in lawsuits filed after trucking accidents under a bill moving through the Georgia General Assembly.
Senate Bill 191, reported favorably last week by the Senate Transportation Committee, would repeal the Georgia law that allows injured plaintiffs to sue truck insurance carriers directly, a practice known as joinder.
“Georgia is one of only four states left that still allows plaintiffs’ attorneys to seek damages from the actual insurance carrier,” the bill’s chief sponsor, Sen. Shawn Still, R-Norcross, said at a committee hearing.
In most types of vehicle accidents, injured parties may recover up to the limits of the negligent party’s insurance policy. In Georgia and three other states, including Louisiana, once the at-fault driver’s policy reaches its limit, or the defendant can’t be served, the plaintiff can sue the insurer for damages, Still explained.
“This is the only industry in which (a plaintiff) could also include my insurance carrier” in a lawsuit, he said.
The two-page bill would remove just a few words from Georgia statutes: “It shall be permissible under this part for any person having a cause of action arising under this part to join in the same action the motor carrier and the insurance carrier, whether arising in tort or contract.”
The current law came about as a way to allow injured parties to be made whole if the trucking company owner or operator could not be located. But transport companies and insurers have said the law is unnecessary in today’s online world, where truckers can be tracked down, and has led to higher premiums for many Georgia truckers.
Georgia Insurance Commissioner John King also spoke in favor of the bill.
“Small trucking companies are getting squeezed out of the marketplace because they can’t afford insurance,” King said. Only five major carriers now offer truck insurance in Georgia, he noted.
Lobbyists on both sides of the issue have shown up in force at the state capitol in recent weeks, committee Chairman Greg Dolezal, R-Cumming, said at the hearing. Some of them spoke at the meeting.
“This is killing small trucking companies,” said Ed Crowell, president of the Georgia Motor Trucking Association.
The current statute exists mostly to increase jury verdicts against truck insurance companies, said Bob Fuller, president of Fleet Risk Management Inc., now part of AssuredPartners Transportation, an insurance broker.
Georgia has some of the highest premiums on policies sold to for-hire truckers, and at least one carrier recently backed out of the state after being served with a direct-action suit, said Mike Iverson, president of the Independent Insurance Agents of Georgia.
Plaintiffs’ attorneys have opposed the bill and have said that the current law, on the books since 1937, does not force insurers to pay higher damages than policies allow. SB 191 would not reduce jury verdicts, said Brandon Peak, with the Georgia Trial Lawyers Association. He recounted an incident in which a driver was killed in Tennessee, but the truck driver went on the lam and could not be served in the lawsuit. In Georgia, victims are protected and may recover from the insurer in those types of cases, Peak argued.
Injury attorney Dan Snipes said the measure would do nothing to reduce insurance company losses or to attract more truck insurers to Georgia. Other factors are at play, including other states’ incentives programs for insurers and state-sponsored reinsurance programs, he argued.
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