Limitations on Punitive Damages Against Insurers Since State Farm v. Campbell: Lessons for Insurers

Anthony W. Morris, J. Stephen Berry and P. Michael Freed

Journal of Insurance Issues, 2008, vol. 31, issue 2, 75-97

Abstract: This article focuses on the limitations imposed on punitive damages awards by the United States Supreme Court, concentrating tm how these limitations have been applied by lower courts in actions against insurance companies. The article begins by examining the Supreme Court's three "guideposts" for determining whether a punitive award complies with due process. The article focuses on the compensatory damages predicate for determining a punitive award pursuant to the second "guide­ post" requiring trial courts to examine the ratio between actual and potential harm and the punitive award. The article examines what types of damages have been included in the predicate in bad-faith claims against insurers, and argues that under black-letter contract law, only the plaintiff's bad-faith tort damages should be included in the actual or potential harm side of the ratio. Finally, the article examines how the "reprehensibility" of insurers' conduct has affected punitive awards against insurers.

Date: 2008
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.insuranceissues.org/PDFs/312MBF.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wri:journl:v:31:y:2008:i:1:p:75-97

Access Statistics for this article

Journal of Insurance Issues is currently edited by James Barrese

More articles in Journal of Insurance Issues from Western Risk and Insurance Association
Bibliographic data for series maintained by James Barrese ().