H 8076Insurance

Insurance - Motor Vehicle Insurance - Mandatory Arbitration Provision

This bill raises the claim limit for electing arbitration in motor vehicle accident cases from $50,000 to $100,000.

Held for study

Population
Affected

Introduced Feb 27, 2026Committee House Judiciary

Plain-English Summary

This legislation updates the rules regarding motor vehicle insurance and the arbitration process in Rhode Island. Currently, if a person suffers a loss due to a car accident (such as injury or property damage) and the claim is valued at $50,000 or less, they can choose to settle the matter through arbitration rather than a court trial. This bill raises that monetary threshold to $100,000. This means that individuals with higher-value claims can now elect to use the faster, informal arbitration process to resolve their disputes with insurance carriers.

For younger readers

When people get into car accidents, they sometimes disagree about who should pay for the damage or injuries. Usually, they might have to go to court, which takes a long time. There is a faster way called "arbitration," where a neutral person decides what is fair instead of a judge. Before, you could only choose this faster way if the damage was less than $50,000. This new rule says you can choose the faster way even if the damage costs up to $100,000. It helps people fix these problems quicker.

Who & Where It Applies

Impacted groups

Motor vehicle ownersAccident victimsInsurance companiesPersonal injury attorneysArbitrators

Impacted communities

All

Constitutional & Fiscal Check

None Likely

Estimated cost

None

Estimated revenue

None

Bill Analysis

Both viewpoints

For Progressives

Increases access to justice for injured individuals by allowing faster, less expensive resolutions for claims up to $100,000, reducing the financial strain of prolonged litigation on working-class families.
Reduces the administrative burden on the public court system, allowing judicial resources to be better allocated to complex cases or criminal justice reforms.
Empowers accident victims (plaintiffs) by expanding their right to choose a simpler dispute resolution process, potentially leading to quicker compensation for medical bills and lost wages.
Privatizes a larger portion of the justice system, potentially reducing public transparency and preventing the establishment of legal precedents that occur in open court trials.
Insurance companies retain the right to appeal the arbitration decision to a jury trial, which could allow wealthy corporations to drag out the process despite the victim's attempt to use a faster system.
May encourage a system where systemic issues regarding insurance practices are settled quietly behind closed doors rather than being exposed in a public forum.

For Conservatives

Streamlines the resolution of mid-sized civil disputes, which helps decongest the courts and ultimately saves taxpayer money associated with long jury trials.
Respects the autonomy of private parties by expanding voluntary dispute resolution mechanisms that do not require heavy-handed government intervention.
Maintains the fundamental Constitutional right to a jury trial for both parties if the arbitration result is unsatisfactory, preserving the rule of law.
Could encourage plaintiffs and trial lawyers to inflate claim values to reach the new $100,000 threshold, potentially driving up insurance premiums for responsible drivers.
May result in duplicative legal costs for businesses (insurers) if plaintiffs use the arbitration process merely as a strategy to test their case before demanding a full trial anyway.
Represents government interference in private insurance contracts by mandating specific arbitration clauses and thresholds.

Votes

Loading votes...

Full Bill Text

Changes to existing Rhode Island law · 3 additions · 1 deletion

SECTION 1. Section 27-10.3-1 of the General Laws in Chapter 27-10.3 entitled "Motor Vehicle Insurance — Mandatory Arbitration Provision" is hereby amended to read as follows: 27-10.3-1. Arbitration provision.

(a) Every contract of motor vehicle liability insurance, issued in the state by an insurance carrier authorized to do business in the state, shall contain the following provisions:

(1) Any person, referred to in this section as “the plaintiff,” suffering a loss, allegedly resulting out of the ownership, maintenance, or use of a motor vehicle by an insured or self-insured, and allegedly resulting from liability imposed by law for property damage, bodily injury, or death, may, at the plaintiff's election, whenever the claim is for ~~fifty thousand dollars ($50,000)~~ one hundred thousand dollars ($100,000) or less, submit the matter to arbitration pursuant to chapter 3 of title 10;

(2) Selection of arbitrator. After submission to arbitration by the plaintiff, one arbitrator shall be selected from the list of qualified arbitrators of the court annexed arbitration program of the superior court in the same manner as arbitrators are selected in accordance with the rules of that program. Each party shall share the expenses of arbitration in accordance with the rules of the court annexed arbitration program;

(3) Hearings. The arbitrator shall call a hearing and provide seven (7) days’ notice of the time and place of the hearing to the parties. The hearing shall be informal, and the rules of evidence prevailing in judicial proceedings shall be binding. Any and all documentary evidence and other data deemed relevant by the arbitrator may be received in evidence. The arbitrator shall have the power to administer oaths and to require by subpoena the attendance and testimony of witnesses, and the production of books, records, and other evidence, relative or pertinent to the issues presented to them for determination. The decision of the arbitrator shall be binding upon the parties unless:

(i) In the event that suit has not been instituted, either party reserves the party’s right to a jury trial by giving notice of this reservation of right to the other party or parties and to the arbitrator within sixty (60) days of the arbitrator’s award by certified mail return receipt requested; or

(ii) In the event that suit has been instituted, either party files a request for a jury trial with the court and with notice to the other party or parties within sixty (60) days of the arbitrator’s award. If the case proceeds to trial subsequent to arbitration, the decision of the arbitrator shall not be admissible;

(4) Statute of limitations. Notwithstanding the foregoing, a suit shall be instituted in order to bring the action within any applicable statute of limitations, but the suit will be stayed until an arbitrator’s award has been made or the case reached for trial;

(5) Agreements to arbitrate. Uninsured motorist contracts shall be governed by the provisions of § 10-3-2.

(b) Every person who maintains motor vehicle liability insurance shall, when making an application for a motor vehicle operator’s license, or the renewal of that license, or when registering a motor vehicle, agree in writing on a form provided by the director of the department of transportation to be bound by the provisions of this chapter.

SECTION 2. This act shall take effect upon passage.