mmar@sphinx.UChicago.UUCP (Mitchell Marks) (08/03/85)
I was unable to reply by e-mail, but as it's relevant to a current discussion I hope the author won't mind if I post it along with my reply. > If you honestly believe liability claims are resonable are you aware that 1 > dollar out of every 6 in the price of new aircraft goes to pay for the > liability suits. And are you aware that half of the cost of your pediatrician's > care is to cover his liability insurance! > > -- David Burleson Well, DB, certainly you have a point, but I don't think it addresses exactly the same one I was making. You point out that the present system results in increased prices for, e.g., aircraft and medical care; we could generalize and say that there are unfortunate consequences, and that they are in part borne by the general public which was not at fault. Okay, but what then? I agree with you, and I guess it amounts to a good case for saying that the system should be changed, somehow. But it does not in any way bear on the issue of whether the individual plaintiffs are getting excessive awards. Consider the more quotidian example of automobile insurance. If someone hits you and you're injured, the law provides a way for you to get compensation for your injuries. No amount of argument about the slow lumbering expensive system would really bear on the justice of your receiving compensation for your injuries. Those arguments might bear on adopting a no-fault system or something like that, and perhaps the concept can be adapted and extended into other areas of liability. But don't lay the problems at the doorstep of the victims who seek relief. also remember that there's two sides. Legal fees and incidental costs go also to defendants' attorneys. They have the option of settling the claims out of court; so don't blame the congestive volume of litigation all on the plaintiffs' side. regards, Mitch Marks -- -- Mitch Marks @ UChicago ...ihnp4!gargoyle!sphinx!mmar
rcj@burl.UUCP (Curtis Jackson) (08/05/85)
>> If you honestly believe liability claims are resonable are you aware that >> 1 dollar out of every 6 in the price of new aircraft goes to pay for the >> liability suits. And are you aware that half of the cost of your >> pediatrician's care is to cover his liability insurance! >> >> -- David Burleson I heartily agree with your views on excessive liability suits, but I do want to make a point about this particular example. Liability insurance is so high because insurance companies are regulated on a state-by-state basis and (apparently) have the local authorities in most states in their pockets. When a major insurance carrier decided to provide malpractice insurance for doctors, they put aside money from premiums to cover the possible loss of suits. They figured the amount of money to put aside (and the premiums) based on losing every lawsuit at a rate quite a bit higher than the average for previous cases (got to allow for inflation, right?). Well, at the end of five years, they had: a) Not settled a single claim, since they 'forgot' to take into account the fact that the average malpractice suit runs for something like 5-7 years total, b) not paid a dime in income taxes on the $72 million dollars in premiums they had ammassed, and c) were, of course, only required at that time to pay taxes (with 5-year-weaker dollars) on the premiums collected the first year (due to the average length of lawsuits), and (last but not least), d) NONE of these oversights were passed back to the customers in lower rates. If you are interested in this area, definitely read Andrew Tobias' book "The Invisible Bankers -- What the Insurance Industry Doesn't Want You to Know" As a closing note (not really a legal one, just a foolish one), consider that your chances of being killed on a domestic airline flight are less than 1 in 1,000,000; which means that for every $3,000,000 American Express takes in on its Flight Insurance program @ $3.00 per ticket; they have to pay out $175,000. How sweet it is! -- The MAD Programmer -- 919-228-3313 (Cornet 291) alias: Curtis Jackson ...![ ihnp4 ulysses cbosgd mgnetp ]!burl!rcj ...![ ihnp4 cbosgd akgua masscomp ]!clyde!rcj