Apparently hostage to the immensely powerful lobby of personal injury lawyers, the D.C. Councill seems likely to adopt Mayor Barry's recent proposal to gut the District's fledgling no-fault insurance statute. But council members, before the bill's second and final reading, should recoil from the mistakes they are about to make. By changing their position on the issue, those who hold swing votes would demonstrate not only political courage but also a well-founded common sense.
If hard evidence seems necessary to justify a fourth-quarter council switch, it exists -- conveniently packaged by the Government Printing Office. Although no-fault proponents have for years had little more than abstractions and anecdotal material to bolster their cause, a recently released study by the Department of Transportation, "Compensating Auto Accident Victims," has brought to light a stockpile of statistical ammunition with which to defend a better system of accident insurance both here and around the country.
The comprehensive report, ignored by the press at its publication in May, unequivocally concludes that no-fault, where properly applied, has proven a boon to those most dependent on the protection of insurance: the unfortunate hundreds of thousands who are counted among America's annual roadway casualties.
Prepared at the request of House transportation subcommittee Chairman James J. Florio, the study compares the performance of traditional tort liability and no-fault schemes over the past 15 years. Among its highlights:
*No-fault is considerably the more efficient system. For example, auto accident victims in Michigan, where no-fault has been implemented in its purest form (high benefits coupled with severe restrictions on court access), receive an average of 14 more cents on their premium dollar. This savings means simply that in no-fault states a greater proportion of insurance money is going where it should -- toward rehabilitating the injured -- rather than being wasted in useless legal and administrative costs.
*No-fault compensates more victims more fully. The number of no-fault payouts per hundred insured cars is double that found in traditional jurisdictions, and succesful no-fault claimants enjoy an average $8,679 in total compensation, 79 percent more than their lawsuit counterparts.
*Payouts are made far more quickly under no-fault. One year after notifying his insurance company of an accident, the average no-fault claimant has received more than 95 percent of his final compensation, while those forced to resort to the tort system have only just over half. Swifter payment facilitates swifter physical recovery through more immediate access to better medical treatment.
*No-fault schemes relieve courts of suffocating caseloads. In the first four years of its no-fault statute, Massachusetts reported a drop of almost two-thirds in the number of automobile negligence suits brought to court (from 30,000 to 11,000 annually), and other no-fault states have witnessed similar dramatic reductions. If Chief Justice Warren Burger is anywhere close to correct in his estimate that the average tort case costs the taxpayer over $8,000, then the savings in administrative expense alone would seem enough to compel a comprehensive switch to no-fault.
Detractors contend that no-fault increases both the rate of auto accidents and the cost of auto insurance. But to what extent would the average driver be any more interested in ending up in the hospital because he wouldn't have to go to court to finance medical care for his injuries or those of others? The DOT has found no increase in accident rates in no-fault states.
As for the second line of attack, car owners in some no-fault states have, it is true, seen significant premium increases. But this has happened only where no-fault schemes have been enacted without corresponding limitations on the right to sue. By contrast, auto insurance costs in "balanced" no-fault states have increased only marginally. In the District, for example, premiums have risen 8 percent in the two years since no-fault went into effect. That is probably not much more than they would have gone up under the old system. Insurance industry observers tell us that the Barry amendment would almost certainly result in faster increases than are occurring under the present statute.
The situation presents a classic problem of special-interest politics. On the one side, one finds a tiny but wealthy and well-organized group that sees a serious threat in change. Whipping no-fault is a top priority among personal-injury lawyers, and their pleas are not ignored by their brethren within the nation's state legislatures. On the other side stand the potential victims of auto accidents, a group both universal and collectively inarticulate. None among us likes to dwell on the horrifying possibilities we face every day behind the wheel, and so we do not band together as prospective beneficiaries of no-fault insurance. The result? A sensible course of action is both resisted and defamed.
We can only hope that Mayor Barry and the council will consider the issue with an eye more on no-fault's proven successes than on short-term political gains in amending D.C.'s present auto insurance statute. At the same time, other states should be encouraged to install or rework no-fault schemes. Rarely is an issue so easily decided, if bitterly fought over.