Attorney: Insurance Restatement Filled With "Litigation Fuel"

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May 09, 2018

At a meeting hosted by the National Council of Insurance Legislators on the American Law Institute’s controversial Restatement of the Law of Liability Insurance, the chairman of Shook Hardy & Bacon’s Public Policy Group said the restatement’s language still has reads as “litigation fuel.”

Specifically, Victor Schwartz pointed to the inclusion of the word “substantiality,” which, he says, “any law professor worth five cents” would know that it is “a weasel word.” He said another “litigation driver” is a clause requiring insurers to provide “adequate” malpractice insurance to insureds. Crowell & Moring Partner Laura Foggan agreed, saying the Restatement is a “magnet for expensive litigation and it’s a change in the law as it exists.”

The insurance restatement, which seeks to clarify the current state of insurance law for judges across the country, will be taken up at the group’s 2018 meeting from May 21-23. The restatement was a topic of heated debate before a scheduled final vote at last year’s meeting, but it was eventually tabled so it could undergo “another year of work.”