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Idaho Proposal to Double Automatic Award of Attorney's Fees Harmful to Consumers, Says NAMIC

INDIANAPOLIS (March 22, 2006)— Legislation pending in Idaho to increase the monetary threshold for an automatic award of attorney's fees by 100 percent in civil actions would be harmful to consumers, according to a spokesman for the National Association of Mutual Insurance Companies (NAMIC).

“NAMIC and other members of the insurance industry have expressed concerns to the Idaho Legislature that Senate Bill 1357 would harm insurance consumers, increase insurance rates and unfairly prejudice defendants in civil actions,” stated NAMIC West Region State Affairs Manager Christian John Rataj.

In essence, SB 1357 would increase the monetary threshold for an automatic award of attorney's fees from $25,000 to $50,000, with the exception of personal injury claims. The bill is currently in the House Committee on Judiciary Rules and Administration.

According to Rataj, “Raising the threshold would unfairly increase a plaintiff's negotiating leverage and is likely to encourage the filing of legally groundless and factually baseless civil claims.”

“Since the bill would increase the number of claims eligible for an automatic award of attorney’s fees, consumers will have to purchase insurance policies with higher liability coverage limits to protect against this greater liability exposure,” said Rataj. “Additionally, an increase in defense costs will ultimately drive up the cost of basic insurance coverage and adversely impact the accessibility and affordability of insurance for consumers.”

96 NAMIC member companies write 37 percent of the homeowners insurance and 28 percent of the automobile insurance in Idaho.

The proposed bill can be read at NAMIC Online

For further information, contact
Rick Nelson, APR, CAE
(317) 875-5250 Tel
(317) 879-8408 Fax

Posted: Wednesday, March 22, 2006 12:00:00 AM. Modified: Thursday, March 23, 2006 9:39:37 AM.

317.875.5250 - Indianapolis  |  202.628.1558 - Washington, D.C.

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