Louisiana Governor Jeff Landry vetoed Senate Bill 111, a proposed measure intended to limit the number of lawsuits filed against insurance companies by modifying standards for bad faith complaints, according to BestWire.
The bill would have blocked bad faith lawsuits in cases involving legitimate disputes over liability or the medical cause of injuries.
It also aimed to prohibit such lawsuits if insurers had not been given a chance to conduct proper discovery, had not received a settlement demand within policy limits, or were not provided at least 30 days to respond.
In his veto message, Landry argued that some insurers deliberately delay claim resolutions to reduce payouts. He emphasized that existing bad faith penalty laws serve as a key deterrent against such tactics.
He warned that SB 111 would allow insurers to reject valid claims more easily, increase legal uncertainty, and reduce policyholders’ ability to challenge unjust denials.
Landry raised particular concern over the bill’s language on “adequate discovery,” which he described as vague and potentially exploitable to postpone claims by claiming discovery was incomplete.
Insurance Commissioner Tim Temple criticized the veto, describing SB 111 as a missed opportunity to improve the legal environment for insurers in Louisiana. He stated that high litigation costs are passed on to consumers through higher premiums and that the bill would have helped stabilize the market.
People across the state tell me the giant payouts promoted by all the attorney billboards and commercials encourage too many lawsuits in Louisiana, but our laws punish insurance companies for defending themselves in court.
Insurance Commissioner Tim Temple
Temple also said that advertising by plaintiff attorneys encourages excessive litigation and that current laws penalize insurers for defending claims in court. According to Temple, SB 111 would have addressed these issues by limiting frivolous lawsuits and reducing insurance costs across the state.
“SB 111 would have simply addressed that broken part of our legal system, incentivizing insurers to defend themselves from those frivolous lawsuits and reducing costs in our insurance market,” Temple said.
