Insurance Journal: New York Gov. Hochul Vetoes Wrongful Death Damages Bill

By: Andrew G. Simpson

New York Gov. Kathy Hochul last night vetoed a measure that would have expanded wrongful death benefits after her late bid for amendments was rejected by the sponsors of the bill.

In vetoing the Grieving Families Act, Hochul called for more study of the bill’s effects on the economy, businesses, and the health care system.

The bill sought to allow emotional damages including for grief or anguish and loss of affection and companionship in wrongful death cases and expand the list of family members eligible for damages.

Yesterday, Hochul went public with concerns over the bill’s economic impact before the midnight deadline for her to act on it in an editorial in the New York Daily News. She proposed several changes including an exemption for medical malpractice claims.

“This bill passed at the very end of the legislative session; the bill was approved in committee and voted on by both the Assembly and Senate, in full, on the very same day. What was missing was a serious evaluation of the impact of these massive changes on the economy, small businesses, individuals, and the state’s complex health care system,” she wrote.

She advocated that the bill be amended to “give parents of children who have tragically died in accidents the opportunity to seek meaningful accountability for their heart-wrenching loss while, for the time being, exempting far more costly medical malpractice claims.”

In vetoing the bill as passed by lawmakers, Hochul sided with businesses including insurers and health care firms that warned the change would mean higher liability insurance costs for drivers and businesses.

The Democratic sponsors of the wrongful death reform bill said they were “extremely disappointed” and noted that Hochul’s amendments were more restrictive than exempting medical malpractice claims— she also wanted to exclude expanded damages for families with victims older than 18.

“The Governor now says she put forward a ‘fair proposal’ over a month ago, but she doesn’t explain that her counterproposal to the Grieving Families Act only addresses the wrongful deaths of persons under 18 years, and conspicuously exempts deaths that ‘involve or give rise to any actual or potential claim for medical malpractice of any kind.’ Moreover, the Governor’s proposal doesn’t expand the definition of family, nor does it extend the statute of limitations or apply to pending claims,” Assembly Member Helene Weinstein and Senator Brad Hoylman-Sigal said in a statement.

They dismissed Hochul’s claim that the measure needs more study. “The truth is this legislation has been considered more carefully than almost any other bill passed during our time in Albany,” they stated, adding that the Hochul Administration has had seven months to review the issue since its passage last June.

Hochul had until midnight to either veto the bill or let it expire without her signature.

A veto can be overridden by a two-thirds majority in both legislative houses.

While current New York law basically limits recovery in wrongful death cases to a decedent’s close family members and for pecuniary or tangible monetary damages only, the legislation (A.6770/S.74A) would mark a substantial departure by allowing recovery for emotional damages including grief or anguish and loss of affection and companionship. The bill would also enlarge the list of family members who could sue to include spouses and domestic partners, as well as children, grandchildren, great-grandchildren, parents, grandparents, stepparents and siblings. A jury could define who is a close family member.

Advocates for victims claimed the change would bring the state in line with other states’ damages statutes and is long overdue.

The New York Public Interest Research Group said that 47 other states already allow their courts to consider the value of lost relationships and 20 states already recognize claims for the grief and mental anguish experienced resulting from a wrongful death. Alabama and New York are the only states that allow neither, NYPIRG said.

But businesses argued that those new settlements would impose a major burden on the state’s economy,

An analysis from actuarial firm Milliman for the New York Civil Justice Institute found that if the bill is enacted, annual property/casualty insurance premiums – including personal auto and general liability for small businesses – could increase by more than $2 billion or 11%. For medical professional liability insurance, costs are projected to balloon by as much as 45%. Self-insured firms could see liability costs rise $1.7 billion or more than 15% a year, according to Milliman.

The Lawsuit Reform Alliance of New York, an organization allied with healthcare, construction, insurance and other businesses and nonprofits concerned with lawsuit abuse, applauded the veto. “Gov. Hochul’s measured action in vetoing the radical expansion of liability in S.74A has New York’s local governments, small businesses, and healthcare workforce breathing a collective sigh of relief,” Tom Stebbins, executive director, said in a statement. “Now is time to get to work and rein-in New York’s already out of control litigation climate.”