Quick Answer
No. Insurance companies do not need more tort reform to lower Texas auto insurance rates. They need accountability. When an insurer tells lawmakers that lawsuits are the reason premiums are high, but then reports record profits and massive dividends, Texans should recognize the playbook: blame injured people, restrict courthouse rights, and keep more money.
State Farm reported $12.9 billion in net income for 2025, while its auto insurance business swung from a $2.7 billion underwriting loss in 2024 to a $4.6 billion underwriting gain in 2025. It also announced a $5 billion dividend to qualifying auto policyholders, the largest in company history. Those numbers make it hard to accept the argument that insurance companies are helpless victims of the civil justice system. (State Farm Newsroom)
Key Takeaways
- The push for tort reform is not mainly about helping consumers. It is about giving insurance companies more leverage against injured people.
- State Farm’s 2025 financial results show that major insurers can become highly profitable without waiting for new tort reform laws to reshape the courts.
- Georgia passed sweeping tort reform in April 2025, but those changes did not have time to explain a nationwide insurer’s full-year financial turnaround. (Office of the Governor)
- Texas already has major tort limits, including proportionate responsibility, a two-year injury deadline, medical-bill proof fights, and trucking-case rules. (Texas Statutes)
- If insurers want to blame lawsuits for high premiums, they should be required to prove that claim with transparent rate data, not slogans.
- Injured Texans should not lose the right to hold negligent drivers, trucking companies, and insurers accountable just because the insurance industry wants higher margins.
The Insurance Company Story: “Lawsuits Are the Problem”
Across the country, insurance companies and corporate lobbying groups keep repeating the same message: lawsuits are out of control, jury verdicts are too high, and premiums will not come down unless lawmakers make it harder for injured people to sue.
That message is designed to sound consumer-friendly. It gives drivers a villain for rising premiums. It lets insurers say, “We are not the problem. The courthouse is the problem.”
But that is not the whole story.
Insurance companies set premiums using many factors, including claim frequency, repair costs, medical costs, where a person lives, driving history, vehicle type, and the company’s own pricing formula. The Texas Department of Insurance explains that each company’s premium formula is different and that auto premiums are based on multiple factors, not simply lawsuits. (Texas Department of Insurance)
So when an insurer blames lawsuits for high rates, Texans should ask: Are lawsuits really driving the price, or is the insurance company using lawsuits as a convenient excuse to charge more and pay less?
What State Farm’s 2025 Profits Tell Us
State Farm’s 2025 financial results are the kind of facts that cut through the talking points.
According to State Farm’s own public release, the company reported $12.9 billion in net income in 2025, compared with $5.3 billion in 2024. Its auto insurance business also produced a $4.6 billion underwriting gain after reporting a $2.7 billion underwriting loss the year before. (State Farm Newsroom)
That is not a struggling company begging for survival. That is a massive financial turnaround.
| State Farm result | 2024 | 2025 | What it shows |
|---|---|---|---|
| Net income | $5.3 billion | $12.9 billion | The company more than doubled net income. |
| Auto underwriting result | $2.7 billion loss | $4.6 billion gain | The auto business swung sharply into profit. |
| Total revenue | $123.0 billion | $132.3 billion | Revenue increased year over year. |
| Auto policyholder dividend | Not reported as comparable | $5 billion announced | State Farm had enough surplus strength to return money to qualifying auto customers. |
State Farm also said the dividend was possible because of financial strength and stronger-than-expected underwriting performance. It separately pointed to lower collision frequency and repair-cost trends when discussing rate reductions. (State Farm Newsroom)
That matters because insurers often tell lawmakers they need tort reform to stabilize the market. But when the profits arrive, the explanation changes. Suddenly, the story is underwriting performance, pricing, claims trends, and company strength.
This is why many injury lawyers oppose tort reform. The issue is not whether insurance companies are allowed to make money. The issue is whether they should be allowed to use high premiums as a political weapon while asking lawmakers to weaken the rights of injured people.
Georgia’s 2025 Tort Reform Shows the Playbook
Georgia became a national example in 2025 when Governor Brian Kemp signed Senate Bills 68 and 69 on April 21, 2025. The Governor’s office described the package as “meaningful tort reform” intended to address litigation costs and stabilize insurance costs. (Office of the Governor)
The political message was clear: restrict lawsuits now, and insurance relief will follow.
But the timing raises a serious question. Georgia’s tort reform was signed in late April 2025. Sweeping civil justice changes do not instantly affect all claims, all trials, all appeals, all reserves, and all rate decisions across the country. Yet State Farm’s 2025 financial results showed a major turnaround before those new restrictions could fully work through the civil justice system.
That does not prove that every insurer acted improperly. It does prove that the “we need tort reform to survive” argument deserves skepticism.
A fair reading is this: insurance companies wanted tort reform because it benefits them. They wanted fewer lawsuits, lower claim payouts, more procedural hurdles, and more negotiating leverage. The promise of lower premiums made the pitch easier to sell.
That is greed dressed up as consumer protection.
Why Tort Reform Hurts Real Texans
Tort reform means changes to civil liability law that usually make injury claims harder to bring, harder to prove, or less valuable. A tort is a civil wrong, such as negligent driving, unsafe trucking, drunk driving, or failing to maintain a dangerous property.
Insurance companies like tort reform because it changes the leverage equation.
When injured people have fewer rights, insurers can:
- delay longer;
- offer less;
- dispute medical bills more aggressively;
- blame the victim more easily;
- pressure people into early settlements;
- make smaller cases financially impossible to pursue;
- reduce the risk of facing a jury.
That is the real reason tort reform is so attractive to insurers. It does not just reduce “frivolous lawsuits.” It also makes valid claims harder.
A San Antonio driver with a herniated disc, unpaid medical bills, lost wages, and months of pain is not abusing the system by asking for accountability. A family who loses someone in an 18-wheeler crash is not causing an insurance crisis by filing a wrongful death claim. A motorcyclist hit by a distracted driver is not the reason billion-dollar insurers keep raising premiums.
The civil justice system exists because without it, negligent drivers, corporations, and insurance companies would face far less accountability.
Texas Already Has Tort Limits
Texas is not a lawsuit free-for-all. Insurance lobbyists often talk as if injured people can simply walk into court and collect money. That is false.
Texas already has significant limits and defenses.
| Texas rule or issue | What it means | How it affects injured people |
|---|---|---|
| Proportionate responsibility | Fault is assigned by percentage. A claimant cannot recover if more than 50% responsible. | Insurers often try to shift blame to reduce or defeat claims. |
| Two-year statute of limitations | Most injury lawsuits must be filed within two years. | Delay can destroy an otherwise valid claim. |
| Medical-bill disputes | Insurers challenge whether charges are reasonable and necessary. | Medical proof becomes a major battleground. |
| UM/UIM requirements | Insurers must offer uninsured/underinsured motorist coverage unless rejected in writing. | Your own policy may matter when the at-fault driver has low limits. |
| Trucking-case rules | Certain commercial vehicle cases have special procedural rules. | Serious cases may face additional litigation hurdles. |
Texas proportionate responsibility law bars recovery if the injured person’s percentage of responsibility is greater than 50%. (Texas Statutes) Most Texas personal injury and wrongful death claims also face a two-year filing deadline. (Texas Statutes)
Texas law also regulates insurance rates. Under Texas Insurance Code Chapter 2251, a rate may not be excessive, inadequate, unreasonable, or unfairly discriminatory. (Texas Statutes)
That point matters. If rates are too high, the answer should be insurance transparency and rate accountability, not stripping rights from injured people.
For crash victims dealing with insurance pressure, our guide to what to do after a car accident in San Antonio explains practical steps to protect a claim.
The Greed Problem: Charge More, Pay Less, Blame the Victim
The insurance industry’s tort reform strategy works because it separates two things that should be discussed together: premiums and claim payouts.
When premiums go up, insurers blame lawsuits.
When claims are filed, insurers blame medical providers, injured people, prior conditions, “minor impact,” treatment gaps, and lawyers.
When profits rise, insurers call it strong underwriting.
This is the cycle:
- Raise premiums.
- Tell the public lawsuits forced the increase.
- Ask lawmakers to restrict lawsuits.
- Use the new restrictions to pay less on claims.
- Keep or invest the spread.
- Repeat the message when the next rate fight begins.
That is why this article takes a clear position: Texas does not need more tort reform to protect greedy insurance companies. Texas needs stronger accountability for insurers that overcharge policyholders and underpay injured people.
How the Anti-Injury Playbook Shows Up in Real Claims
Most injured Texans never see the lobbying campaign. They see the claim-handling version of it.
After a crash, the adjuster may say:
- “Your treatment was too expensive.”
- “You waited too long to see a doctor.”
- “Your pain is from degeneration.”
- “The property damage was minor.”
- “You do not need a lawyer.”
- “This is our final offer.”
- “A jury may not believe you.”
- “There is limited coverage, so take it or leave it.”
Sometimes an insurer has a legitimate dispute. Not every claim is the same. But many low offers are not about truth. They are about leverage.
The insurer knows the injured person may be missing work, dealing with pain, worried about bills, and unfamiliar with the system. Tort reform increases that leverage by making the courthouse harder to access.
That is the point.
Attorney Insight: Follow the Money, Not the Slogan
In injury cases, we do not evaluate an insurance company by its advertising. We evaluate it by its conduct.
Does it accept clear liability quickly? Does it fairly evaluate medical evidence? Does it consider future care? Does it account for wage loss? Does it address hospital liens, subrogation, and net recovery? Does it make an offer that reflects the risk its insured created?
The same rule should apply to tort reform. Do not evaluate it by the slogan “lower rates.” Evaluate who gets power.
If a tort reform bill makes it harder for juries to hear the full story, harder for injured people to prove damages, harder to hold corporations accountable, and easier for insurers to pay less, the likely beneficiary is not the average Texas driver. It is the insurance company.
That is why the State Farm numbers matter. They show that the industry can be financially strong while still asking lawmakers for more protection.
After a Texas Car Accident, Do These 7 Things Before the Insurance Company Controls the Story
- Report the crash. Call 911 when anyone is hurt or there is meaningful damage. A crash report helps document the basic facts.
- Get medical care promptly. Delays give insurers room to argue that you were not hurt or that something else caused your symptoms.
- Take photos and video. Capture vehicle damage, the scene, traffic controls, skid marks, debris, injuries, and insurance information.
- Identify witnesses. Independent witness statements can defeat unfair blame-shifting.
- Do not give a recorded statement without understanding the risk. Adjusters are trained to ask questions that can later be used against you.
- Check your own coverage. Look for PIP, MedPay, UM/UIM, collision, rental, and wage-loss-related benefits.
- Track every loss. Save bills, receipts, mileage, work notes, employer letters, medical records, and out-of-pocket expenses.
If the at-fault driver has no insurance or not enough insurance, read our guide to uninsured and underinsured motorist coverage in Texas. Texas insurers must offer UM/UIM coverage unless it is rejected in writing. (Texas Statutes)
What Insurance Companies Do Not Say About “Frivolous Lawsuits”
The phrase “frivolous lawsuits” is powerful because nobody supports meritless claims. But the phrase is often used to attack legitimate injury cases too.
A valid claim may still be called exaggerated if:
- the medical bills are high;
- the injury involves pain that cannot be seen on an X-ray;
- the person had prior back or neck problems;
- treatment lasted longer than the adjuster wanted;
- surgery was recommended;
- the injured person is young and “should have healed”;
- the injured person is older and the insurer blames age;
- the crash involved disputed fault.
That is why juries matter. A jury is one of the few places where an ordinary person can stand on equal footing with an insurance-backed defendant.
Tort reform weakens that equal footing.
Why “Lower Premiums” Should Require Proof
If insurance companies want Texans to give up legal rights in exchange for lower premiums, they should have to prove the trade.
That means:
- showing how much of each premium dollar is actually tied to lawsuits;
- showing whether rate increases exceeded loss trends;
- showing how much savings from tort reform will be passed to policyholders;
- committing to measurable rate reductions;
- reporting claim-denial and claim-delay data;
- disclosing how much is spent on lobbying for liability limits;
- explaining executive compensation and surplus growth when premiums rise.
Without that proof, the deal is one-sided. Injured people lose rights immediately. Policyholders may or may not see savings later. Insurance companies keep the leverage either way.
That is not reform. That is a transfer of power from Texans to insurers.
What This Means for San Antonio and Texas Injury Victims
In San Antonio and Bexar County, we see the practical side of insurance-company leverage every day. The same is true across Comal, Guadalupe, Kendall, Wilson, Atascosa, Medina, Harris, Dallas, Tarrant, Travis, Hidalgo, Cameron, Nueces, Webb, and other Texas counties.
A crash victim does not need a lecture about tort reform. They need answers:
- Who was at fault?
- What insurance coverage exists?
- Who pays the medical bills?
- What if the at-fault driver has minimum limits?
- What if the insurance company denies the claim?
- What if the adjuster says the treatment is too expensive?
- What is the deadline to file suit?
- What will the client actually net after liens and expenses?
For serious crashes involving commercial vehicles, our page on San Antonio truck accident claims explains why these cases often require early evidence preservation.
For families dealing with fatal crashes, our guide to Texas wrongful death claims explains the basic legal issues that may apply.
The Bottom Line: Texas Should Protect People, Not Insurance Profits
Insurance companies are entitled to defend claims. They are entitled to investigate fraud. They are entitled to make a profit.
But they should not be entitled to rewrite the civil justice system every time they want more leverage.
The State Farm numbers are a warning. When a company can report billions in net income, announce a historic dividend, and still benefit from a national political push to limit lawsuits, Texans should be skeptical.
Tort reform is often sold as a way to help consumers. In practice, it often helps insurance companies pay less to the people they owe money to.
Texas should not make it harder for injured people to hold wrongdoers accountable just because greedy insurance companies want a bigger advantage.
FAQ
Do insurance companies need tort reform to lower Texas auto insurance rates?
No. Insurance companies do not need more tort reform to lower Texas auto insurance rates. Premiums are based on many factors, including claim frequency, repair costs, medical costs, driving history, location, and insurer pricing decisions. If insurers claim lawsuits are the problem, they should prove it with transparent rate data before Texans give up legal rights.
Why do insurance companies push tort reform?
Insurance companies push tort reform because it gives them more leverage. Lawsuit restrictions can make claims harder to prove, reduce settlement pressure, limit what juries hear, and make smaller valid cases harder to pursue. That benefits insurers because they collect premiums on the front end and face less payout risk on the back end.
Did Georgia’s 2025 tort reform cause State Farm’s 2025 profits?
The timing does not support that simple conclusion. Georgia’s tort reform was signed on April 21, 2025. State Farm’s 2025 financial results reflected nationwide performance over the full year, and the company reported a major auto underwriting turnaround before Georgia’s new rules could fully reshape claims, trials, appeals, reserves, and rates.
Is Texas already a tort reform state?
Yes. Texas already has significant civil justice limits. Texas proportionate responsibility law bars recovery if an injured person is more than 50% responsible. Most injury claims also face a two-year filing deadline. Insurers can and do use existing defenses to dispute fault, causation, medical bills, and damages.
Are all lawsuits against insurance companies or defendants valid?
No. Every claim must be evaluated on its facts. Liability, causation, damages, and coverage must be proven. But the existence of some weak claims does not justify taking rights away from seriously injured people with valid claims. The better answer is careful case evaluation, not blanket restrictions that mostly benefit insurers.
Can an insurance company blame me for the crash to reduce what it pays?
Yes. In Texas, insurers often argue that the injured person was partly responsible. Under proportionate responsibility, your recovery can be reduced by your percentage of fault, and you may recover nothing if you are more than 50% responsible. Evidence such as photos, witness statements, video, and crash reports can be critical.
What should I do if the adjuster says my medical bills are too high?
Do not accept that statement at face value. Medical-bill disputes depend on treatment records, diagnoses, provider charges, payment status, liens, health insurance, and whether the care was reasonable and necessary. Save every bill, explanation of benefits, medical record, referral, prescription, and work restriction before discussing settlement.
Should I talk to a lawyer before accepting a Texas car accident settlement?
Yes, especially if you had medical treatment, missed work, ongoing pain, disputed fault, low policy limits, UM/UIM issues, hospital liens, or surgery recommendations. A settlement usually releases the claim permanently. Before signing, you should understand coverage, liens, case expenses, future care, and your likely net recovery.
Talk to Ryan Orsatti Law About a Texas Injury Claim
Insurance companies have adjusters, lawyers, analysts, lobbyists, and public-relations teams protecting their interests. Injured Texans deserve someone focused on the evidence, the law, and the human cost of the crash.
Ryan Orsatti Law represents injured people in San Antonio, Bexar County, surrounding counties, and across Texas.
Ryan Orsatti Law
4634 De Zavala Rd, San Antonio, TX 78249
Phone: 210-525-1200
ryanorsattilaw.com
This blog is for informational purposes only, not legal advice. Reading it does not create an attorney-client relationship. Past results do not guarantee future results.