THE EFFECT OF 1980S TORT REFORM LEGISLATION ON GENERAL LIABILITY AND MEDICAL MALPRACTICE INSURANCE

A large number of states adopted tort reforms in the mid-1980s to limi t the dramatic surge in insurance losses and premiums. Evidence based on liability insurance data by state indicates that these reforms subs tantially influenced general liability insurance. The levels of losses , premiums, and loss ratios (a measure of insurance profitability) all reflected the impact of the reforms. The large-scale reform efforts i n 1986 were particularly influential. Medical malpractice insurance wa s much less sensitive to the reform efforts.