What is a Liability Cap? (Part A)

When news reports announce high settlement amounts for personal injury lawsuits, many people scoff at the amounts. How can a broken hip be worth $250,000? What most don't realize is that while the initial medical bills for an injury may be relatively small, the long-term rehabilitation costs, lost wages, and mental suffering all add up to additional financial strain.

Many states have adopted a liability cap for medical malpractice, reasoning that it will cut back on frivolous lawsuits. National federal regulations have also established a liability cap for industries such as oil drilling, again to ward off the potential for absurd lawsuits.

How does a liability cap work?

Let's look at the state of Virginia and their medical malpractice liability cap, since I am a Virginia medical malpractice attorney. The state of Virginia basically says that no matter what your damages may be, your medical malpractice case cannot settle for more than $2 million. This amount was previously $1 million before new legislation in August 1999 began to raise the cap to its present amount.

The liability cap prevents a lawsuit from settling for more than $2 million, with no more than $350,000 in punitive damages. One of the main reasons a liability cap exists in Virginia medical malpractice claims is that many frivolous lawsuits have high non-economic damages. Non-economic damages are a common part of many types of lawsuits, not just Virginia medical malpractice.

A liability cap places a "one size fits all" standard on lawsuits, in my case, with Virginia medical malpractice. It's up to the judge and jury in your trial to determine the value of your individual claim, not a state or federal law.

Keep reading to learn how a liability cap can become a big problem when a serious medical or disaster issue arises, and find out what can be done about ineffective liability caps.

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Ben Glass
Ben Glass is a nationally recognized Virginia injury, medical malpractice, and long-term disability attorney