Category Archives: Legal Environment

Small Biz Litigation Threat

A hearing down on Capitol Hill today titled “Liability Reform and Small Business† highlights the growing litigation risk faced by small businesses and the need for good liability risk management and adequate insurance. The hearing before the House Small Business Committee includes testimony from the president of the U.S. Chamber Institute for Legal Reform (ILR). The ILR has just released two studies showing the impact lawsuits can have on small businesses. According to the studies, the tort system in the U.S. cost small businesses $98 billion in 2005. The threat of lawsuits also alters the way small business owners make decisions, with 62 percent saying they make business decisions to avoid lawsuits. These decisions can have significant effects on the business, such as making products and services more expensive, or making a product or service unavailable to customers. For more information on insurance and risk management for businesses, check out I.I.I.’s new insuring your business website.  

Gun Liability

While we’ve purposely stayed away from the topic of gun liability or risk management lessons to be learned from last month’s shootings at Virginia Tech, an article in the Chicago Sun-Times detailing how a father obtained a gun license for his 10-month-old son forces us to visit this contentious issue. According to the May 13 article, the infant’s father applied on his behalf for the license after his grandfather bought him a shotgun as an heirloom. The application for the license was approved on the third go, after being turned down twice due to technicalities. While the father fully expected the application for the license to be rejected due to his son’s age, it appears that in the state of Illinois there are no age restrictions on issuing a firearms owner’s identification card (FOID). At risk of stating the obvious, we note that 16 remains the age at which a teen, subject to successful completion of driver education, can apply for a driver’s license in Illinois.  As  many states have legislation in place that restricts or prevents lawsuits against the gun industry, the question is should we be concerned? Following the Virginia Tech tragedy and given the lawsuits targeting “Big Tobacco†, and more recent suits against the alcohol industry and fast food industry, could we be looking at a potential rise in claims under liability coverages? What are your thoughts? Check out further I.I.I. info on the liability system.