LEGAL REFORM

PRODUCT LIABILITY REFORM

THE ISSUE IS… The enactment of federal product liability reform legislation.

IT’S IMPORTANT BECAUSE… The current state of product liability law is such that the former fault-based system has been transformed into one of strict liability, which punishes manufacturers and their customers regardless of fault. This strict liability system has served to inhibit the development of new products and adversely impact the international competitiveness of products manufactured in this country.

Efforts undertaken by various states to enact product liability reform measures have been largely unsuccessful. However, progress is being made in some states. On the federal level, legislation to create uniform national product liability rules has been pending for several years. However, powerful plaintiff trial lawyer lobbying groups have successfully assisted in stopping such reform measures to date.

NAMIC POSITION… The imbalance and uncertainty of evolving state tort law are major contributing factors to increasing product liability insurance costs. NAMIC endorses efforts to enact a federal product liability reform law that will restore fairness and predictability to the marketplace.

Posted: Thursday, May 12, 2005 12:00:00 AM. Modified: Thursday, May 12, 2005 11:31:05 AM.

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We are 1,400 property/casualty insurance companies serving more than 135 million auto, home and business policyholders, with more than $196 billion in premiums accounting for 50 percent of the automobile/homeowners market and 31 percent of the business insurance market. We are the largest and most diverse property/casualty trade association in the country, with regional and local mutual insurance companies on main streets across America joining many of the country’s largest national insurers who also call NAMIC their home. More than 200,000 people are employed by NAMIC members.