Governor Landry Signs Six Bills into Law as Part of Sweeping Insurance, Tort Reform Effort
In what he is billing as the "largest tort reform in our state's history," Governor Jeff Landry signed six bills into law on Wednesday, May 28 that could reshape the insurance industry and insurance-related litigation in Louisiana. The new laws may also have an impact on Louisiana businesses and business owners as the bills aim to lower liability insurance premiums and reduce frivolous lawsuits with large recoveries.
The bills passed by the Louisiana Legislature and enacted by Governor Landry include: HB 148 ("Insurance Commissioner Authority"), HB 450 ("Housley Presumption"), HB 434 ("No Pay No Play"), HB 436 ("Illegal Aliens"), HB 431 ("Comparative Fault"), and HB 549 ("Dash Cam Discount"). Below is a summary of the laws' contents and their potential ramifications.
HB 148 – Expansion of Insurance Commissioner's Authority
Sponsored by State Representative Jeff Wiley of Gonzales, House Bill 148 empowers the Louisiana Insurance Commissioner to reject proposed rates set by insurance companies that the Commissioner deems "excessive." The bill defines an "excessive" rate as one "likely to produce a profit that is unreasonable high for the insurance provided or the expense provision included therein is unreasonably high in relation to the services rendered." According to Governor Landry's office, several states across the South (including Alabama, Florida, Mississippi, South Carolina, and Texas) have implemented similar laws.
The new law's supporters hope it enables Louisiana to combat escalating rates and premiums for policyholders. But the bill has encountered staunch opposition—including from the Insurance Commissioner himself, Tim Temple. Even though the law will expand his office's authority, Temple (like other critics) fears that granting the state the authority to reject "excessive " rates will deter insurance companies from issuing policies and doing business in Louisiana.
HB 450- Housley presumption overruled
HB 450 enacts new Code of Evidence Article 306.1, which provides, with some exceptions, that "the lack of a prior history of an illness, injury, or condition shall not create a presumption that an illness, injury, or condition was caused by the act that is the subject of the claim." The new code article legislatively overrules the Housley presumption. In Housley, the Louisiana Supreme
Court established a presumption of medical causation in personal injury cases where the injured plaintiff could show: (1) that he was in good health prior to the accident; (2) that symptoms of the alleged injury appeared after the accident and continuously manifested themselves thereafter; and (3) that there is a "reasonable possibility of causation" between the accident and the claimed injury as established by medical evidence, circumstantial evidence, or "common knowledge". Housley v. Cerise, 579 So.2d 973 (La. 1991).
Typically given as a jury instruction, the Housley presumption limited the defense of injury claims where the injured plaintiff had no prior history of related medical complaints. The new rule, in its departure from the "reasonable possibility of causation" standard required for the application of the Housley presumption, affirms Louisiana's long-standing medical causation test that requires proof through medical evidence that the injury was more probably than not caused by the subject accident. The claims most impacted by the change in law will be injury claims where there is no evidence of a pre-existing illness, injury, or condition and/or where there is mostly circumstantial evidence of medical causation. The new rule applies prospectively only, meaning that Housley presumption will still be applicable in suits for injuries occurring prior to May 28, 2025.
HB 434 – "No Pay, No Play" bar on recovery significantly increased
This bill, authored by Representative Jason Dewitt of Natchitoches and Rapides Parishes, amends Louisiana's existing "No Pay No Play" law (Lousiana Revised Statute 32:866). The statute will now provide that any driver injured in a motor vehicle accident but who does not own or maintain car insurance is prohibited from recovering up to the first $100,000 in bodily injury damages or $100,000 in property damage in a civil suit. Previously, the "No Pay No Play" law (last amended in 2008) barred a non-insured driver's recovery of the first $15,000 in bodily injury damages and $25,000 in property damages. The bill's proponents hope the increase in "no pay no play" limits will incentivize drivers to acquire insurance and discourage tort suits by uninsured drivers.
HB 436 – Prohibition on car accident suits brought by unauthorized residents
HB 436 precludes unauthorized aliens from bringing civil actions for damages arising from automobile accidents. An alien can still make claims against an uninsured or underinsured motorist policy which names the alien as an insured.
HB 431-Big changes to comparative fault and contributory negligence
Representing a momentous change to Louisiana tort law, HB 431 eliminates Louisiana's pure comparative fault regime and creates a modified comparative fault system. Since 1980, Louisiana has been a pure comparative fault state. In the pure comparative fault system, each actor, whether a party to the litigation or not, is assigned a percentage of fault and the judgment is reduced by the percentage of fault attributed to the plaintiff.
In the new system, the judge or jury is still required to determine the percentage of fault of all contributors to an accident. But, if the plaintiff is determined to be 51% or more at fault for his injuries, the plaintiff will not recover any damages. Conversely, if the plaintiff's own negligence is determined to be 49% or less, the plaintiff's damages will be reduced in proportion to the percentage of fault attributable to the plaintiff.
It will be interesting to see how the new system will affect jury verdicts and settlements. The new system may deter some frivolous lawsuits, but the number of cases wherein a plaintiff is found to be 51% negligent is relatively small.
The new modified comparative fault law takes effect on January 1, 2026. HB 431 does not specify whether the new rule applies retroactively. The issue of retroactivity will likely be determined by a Louisiana court.
HB 549- Dash Cam discount for commercial motor vehicles
HB 549 enacts a new law applicable to owners of commercial motor vehicles who install dashboard cameras and telematics systems in their vehicles. The new law requires non-surplus lines liability insurers to provide a discount on the liability premium for each commercial motor vehicle equipped with a dash cam and a compliant telematics system. The new law becomes effective on January 1, 2026, and only applies to commercial motor vehicle policies issued or renewed on or after January 1, 2026. The act is aimed at enhancing public safety, reducing insurance fraud, and lowering the cost of claims and of liability insurance premiums.
The attorneys here at Stone Pigman are following the latest developments regarding this tort reform in Louisiana and will provide further updates as pertinent information becomes available.