Insurance Welfare Act

South Carolina’s unpopular Senate Bill 244, the “Insurance Welfare Act,” is being framed as a necessary reform to lower insurance premiums and supposedly curb frivolous lawsuits. In reality, it’s a blatant power grab by the insurance industry that shifts financial burdens onto accident victims, policyholders, and small businesses while allowing insurance companies to profit even more.

This bill does not provide meaningful protections for consumers, nor does it include any requirement that insurers actually lower premiums. Instead, it strips away key legal protections that have ensured accountability for decades, giving insurance companies even greater control over claims and payouts while leaving everyday South Carolinians with fewer options when they are wronged.

If this bill were truly about lowering premiums, it would require insurers to reduce rates in exchange for these new protections. It doesn’t. Instead, it hands insurance companies more ways to delay, deny, and underpay claims, leaving South Carolinians with fewer legal remedies when they’re harmed. By eliminating bad faith and the Tyger River Doctrine, the bill removes the strongest legal tool for holding insurers accountable when they refuse to pay valid claims in bad faith. Without it, insurers can lowball settlements or delay payments indefinitely, knowing policyholders have no real way to fight back.

This bill would also weaken Uninsured and Underinsured Motorist (UM/UIM) coverage, meaning victims of drunk or reckless drivers will have fewer financial protections and will be left to cover their own damages when insurers refuse to pay.

On top of that, it caps non-economic damages in medical malpractice cases, making it harder for victims to recover fair compensation for pain and suffering. The most vulnerable, such as elderly patients, disabled individuals, and stay-at-home parents, will be affected the most. Many of these individuals already face challenges in securing fair compensation due to the nature of their cases, and this bill would make it even easier for negligent doctors and hospitals to avoid full accountability.

Beyond giving insurers a free pass, S 244 also makes it harder to hold businesses, bars, and contractors accountable when their negligence harms people. This isn’t reform—it’s a corporate bailout for the insurance industry at the expense of South Carolinians. Similar laws, such as the 2020 tort reform in Louisiana and past examples in other states, have unsurprisingly failed to lower insurance premiums and have only made it more difficult for victims to get justice.

If S 244 passes, insurers win big while South Carolinians lose legal protections they’ve relied on for decades. Lawmakers should reject this bill and stand with consumers, not corporations.