A bill that would add insurance firms to Oregon’s Unlawful Trade Practices Act has attracted intense opposition from over 40 lobbyists, who argue that the revised law would overburden the state’s courts with unnecessary civil litigation and result in greatly increased premiums for consumers. House Bill 3160 would allow Oregon residents to file lawsuits against their insurance providers for failing to cover medical bills or taking too long to respond to claims. Insurance companies represent the only remaining industry exempt from the Unlawful Trade Practices Act; banks were included in 2010 following the economic downturn.
Consumer advocates have spoken out in support of HB 3160, contending that insurance remains exempt from the Act despite its significant importance in the lives of thousands of Oregon residents. A director with Economic Fairness Oregon argued that lobbyist contributions are the sole reason why insurance firms are currently not subject to the act.
Forty-seven lobbyists representing business associations and insurance companies have signed a letter formally requesting legislators to strike down the bill, while several lobbyists for trial lawyers and consumers have voiced their support for the measure. Among the bill’s supporters is a former governor of Oregon who once objected to similar legislation over two decades ago. He cited a changing economic climate and the 2007 collapse of the financial services industry as a reason for lawmakers to “provide greater consumer protection against fraudulent business practices” perpetrated by insurance companies.
Representatives for insurance firms argue that HB 3160 would result in a flood of frivolous litigation and dramatically inflated damages, but a lobbyist for the Oregon Trial Lawyers Association contends that the bill would have such an effect only if a large number of insurance firms in the state are failing to properly serve their clients.
Under the state’s current laws, Oregon residents are restricted in the way they take legal action against their insurance providers. An individual who is unsure whether he or she has a case against an insurance company should contact a qualified attorney specializing in civil litigation to learn more.
Source: OregonLive, “Dozens of lobbyists tie up bill to let consumers sue insurance companies” Yuxing Zheng, Jun. 14, 2013