Nuclear verdicts rise, affect insurance cost
A research organization of American Trucking Associations recently released a report that shows so-called nuclear verdicts — large jury awards, sometimes in excess of $10 million — have continued to rise as the Arkansas Trucking Association works to address rising insurance costs and tort reform.
Nuclear verdicts regard the high costs carriers face as a result of lawsuits involving truck crashes, and the rising risk of such verdicts has contributed to an increase in insurance costs, according to FreightWaves.
American Transportation Research Institute recently released a report showing large verdicts against trucking companies have risen in number and award size. Between 2010 and 2018, the size of the awards rose 51.7% annually while inflation rose 1.7% and healthcare costs increased 2.9%. The number of cases in which awards were more than $1 million rose to 300 over the past five years, from 26 cases between 2006 and 2011.
“The litigation climate continues to deteriorate for business, especially trucking,” said Shannon Newton, president of Arkansas Trucking Association. “Policy changes dealing with court rules and damage awards are extremely challenging in Arkansas due to verbiage in our state’s constitution and existing case law from the Arkansas Supreme Court. In 2018, our association was part of a coalition that spent a year and half of legislative work and over $1 million on a campaign trying to get a constitutional amendment on the ballot that would have limited attorney’s fees, changed rulemaking processes and allowed for damage caps. But it was ultimately stricken from the ballot by the Supreme Court just weeks before the November 2018 election.”
Yet, the association remains focused on the issue and “was intimately involved in the recent executive orders signed by the governor extending immunity due to COVID-19 exposure to employers and businesses,” Newton said. “Our ongoing efforts could include legislation, regulation, a referral or some combination of all of the above. The solution is complicated, longterm and will require a large coalition to continue to invest significant time and resources.”