New Orleans, La. (August 25, 2025) - In 2025, Louisiana lawmakers passed several tort reform acts with the aim of reducing frivolous lawsuits and addressing insurance issues. The Governor also vetoed an "insurance reform" bill limiting bad faith lawsuits against insurers. This summary outlines key developments from the Louisiana State Legislature's 2025 regular session.
Modification of Comparative Fault Scheme
Act No. 15 (HB 431) changes Louisiana's pure comparative fault scheme to that of a modified comparative fault scheme, as set forth in La Civ. Code Art. 2323. Under this new scheme people who are mostly at fault (51% or more) are barred from recovering damages. If the injured party's fault is less than 51%, the amount of damages recoverable is reduced in proportion to the injured party's fault. Importantly, in cases where the issue of comparative fault is submitted to the jury, 2323(D) requires the jury to be instructed on the effect of this Article. Act No. 15 and its changes to Art. 2323 will become effective January 1, 2026.
Elimination of the "Housley Presumption"
Act No. 18 (HB 450) enacted La. Code Evid. Art. 306.1 regarding evidentiary presumptions in personal injury claims. This new law affects how injured plaintiffs prove that a medical condition was caused by an accident. The legislation overrules Housley v. Cerise, 579 So. 2d 973 (La. 1991), which held the lack of a prior history of illness, injury, or condition shall create a presumption, known as the Housley presumption, that said illness, injury, or condition was caused by the act that is the subject of the claim. Now, plaintiffs may not argue the lack of injury or illness before the accident creates a presumption of causation attributing the injury or illness to the accident. This new law expressly states it shall have prospective application only. Therefore, the new law will apply to causes of action arising after May 28, 2025 but will have no effect on those causes of action that arose prior to May 28, 2025.
No Pay, No Play Increase
Act No. 16 (HB 434) changed the "No Pay, No Play" law by increasing the minimum amount of insurance drivers must carry in order to recover from other drivers. The new law increased the amount for owners or operators who fail to maintain compulsory motor vehicle liability insurance by providing there shall be no recovery for the first $100,000 of bodily injury (formerly $15,000) or for the first $100,000 of property damage (formerly $25,000). Additionally, if an uninsured driver sues and is awarded damages equal to or less than $100,000, they will be responsible for all court costs. These changes went into effect on August 1, 2025.
Prohibition of Recovery of Certain Damages for Unauthorized Aliens
Act No. 17 (HB 436) enacts La. Civ. Code Art 2315.12. This new
law bars recovery of general damages and past/future wages to an
unauthorized alien in an action for damages arising from an
automobile accident. The Act does not apply to a claim made against
an uninsured or underinsured motorist policy that names the
unauthorized alien as an insured. "Unauthorized alien" is
defined as a person who is unlawfully present in the United States
according to the federal Immigration and Nationality Act, 8 U.S.C.
1101 et seq. This law went into effect August 1, 2025.
Premium Discounts for Dashboard Cameras and Telematics
Systems
Act No. 19 (HB 549) mandates commercial motor vehicle insurers to provide a premium discount for commercial motor vehicles with dashboard cameras and telematics systems. This mandate does not apply to surplus lines insurers. This new law requires policyholders to provide proof of installation and operation, such as a certificate from a licensed vendor or telematics data report, upon the request of the insurer. Insurers are required to annually verify compliance through the policyholder's submission of a telematics summary report or a signed affidavit attesting to the continuous operation of the dashboard camera and telematics system. This law goes into effect January 1, 2026.
Amendment of La. R.S. §22:1892 Regarding Payment of Claims, Satisfactory Proof of Loss, and Statutory Penalty Applicable to First Party Rental Vehicle Coverage
Act No. 500 (HB 437) amended La. R.S.§22:1892 regarding payment and adjustment of claims. Under the new law, an insurer is allowed to require reasonable proof of payment of the deductible by the policyholder prior to paying recoverable depreciation or replacement cost holdback under a property insurance policy. Reasonable proof of payment is defined to include a canceled check, money order receipt, credit card statement, or a copy of an executed installment plan contract or other financing arrangement.
If an insurer requires a proof of loss statement, the insurer's receipt of a completed proof of loss statement from the claimant will be the only means of constituting satisfactory proof of loss, as already required by present law (R.S. §22:1892 and 1892.2). The proof of loss statement form must be provided to the claimant within ten business days of receiving the claim and the insurer shall also maintain the proof of loss statement form on its website in a location easily accessible by claimants. Insurers must notify claimants whether the proof of loss statement was complete or incomplete within ten business days of receipt of the statement.
The new law increases the statutory penalty to $2,500 plus reasonable attorney's fees if an insurer fails to provide rental vehicle coverage to a first party insured.
These changes went into effect August 1, 2025.
Louisiana Governor Vetoes Bill Limiting Bad Faith Lawsuits Against Insurers
Senate Bill 111 was passed by the Louisiana legislature but vetoed by Gov. Jeff Landry on June 8, 2025. The proposed law had provided there is no cause of action for bad faith against an insurer when any of the following conditions are present: (a) there is a good faith dispute as to liability; or (b) there is a good faith dispute as to medical causation for the injuries; or (c) an offer has not been presented by or on behalf of a third-party claimant within the applicable policy limits and the insurer has been given at least thirty days to respond; or (d) the insurer has not had the opportunity to conduct adequate discovery.
Governor Landry's veto message states the four specific conditions "...would make it easier for insurance companies to deny valid claims, introduce legal uncertainty, and leave policyholders with limited options for recourse." The veto message also indicates "Senate Bill 111 would shield insurers from having to defend decisions to deny settlements and give insurers a broad defense that would severely limit policyholders' ability to hold insurers accountable." Governor Landry's veto message also stated, "[a] major concern with Senate Bill 111 is its requirement that insurers be given the opportunity to conduct adequate discovery before their refusal to settle can be challenged" and further indicates "this phrase is undefined and could be exploited to indefinitely delay claims, simply by asserting that discovery is incomplete."
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