THE INJURY INDUSTRY AND THE REMEDY OF NO-FAULT INSURANCE.

By Jeffrey O'Connell '51. Foreword by Daniel P. Moynihan. Chicago:Commerce Clearing House, Inc., 1971.253 pp. $8.50.

Jeffrey O'Connell has, in my opinion, written an utterly convincing book. As Daniel P. Moynihan writes in his foreword, "The clarity, openness and urgency of his arguments are the marks of a man with an idea whose time is coming."

The idea—no-fault automobile insurance payable by the insured's own company regardless of who is ultimately held to be at blame and excepting only intentional injury—has occupied and perhaps even obsess O'Connell for some years. Along with Professor Robert E. Keeton of the Harvard Law School, O'Connell developed the nofault concept incorporated in recent Massachusetts legislation. O'Connell, now a Professor of Law at the University of Illinois, has served as a Presidential appointee on the National Highway Safety Advisory Committee and is currently on the Board of Directors ofConsumers Union. He has written extensively on automitive insurance and safety. He modestly disclaims the title of "father of no-fault insurance," preferring to designate himself as "a very fond uncle."

The Injury Industry opens with an indictment of the present system of automobile insurance. The basic cause of the problem is nicely summed up in an article quoted by O'Connell from the 1936 issue of Law and Contemporary Problems. "In the days of poor roads and low speeds, the facts of an accident could be reconstructed in the courtroom with some degree of accuracy, and the problem of determining fault did not present unusual difficulties. But with high-powered cars and concrete highways, the probability that an accident—often the consequence of a fractional mistake in management—can and will be described accurately in court has become increasingly remote, especially where court congestion has delayed the time of trial." In other words, fault insurance was already obsolete. The author of the 1936 article, incidentally, was senior law student Richard M. Nixon.

The results of this obsolescence, O'Connell argues, include excessively high cost of automotive insurance, long delays, and shocking inequities in the compensation of accident victims, overburdening of the courts with accident cases, severe pressures eroding ethical standards among lawyers and insurance adjusters involved in settling automobile claims, excessive drainage of funds paid in as premiums into legal fees and overhead expenses of insurance companies unfair and even vicious practices in cancellation of and refusal to sell automotive insurance policies, and too high a rate of insolvency among the companies which do accept high-risk policies.

In a brief review it is not possible even to summarize the reasons why O'Connell and other advocates contend that no-fault insurance provides a sweeping solution which will eliminate or ameliorate all of the above problems; nor is it possible to review O'Connell's discussion and refutation of all of the various criticisms and objections levelled against the no-fault idea. Perhaps the most troubling objection is that unlimited no-fault insurance would bar access to the courts even in instances of extreme negligence. But O'Connell, for just this reason, would put limits on required no-fault coverage.

It must suffice here to say that I, for one, found O'Connell's line of reasoning to be compelling. Indeed, the case for no-fault automotive insurance seems so strong, and so well presented in this book, that my only critical reaction is a feeling that O'Connell may have been too cautious and considerate of the admittedly very substantial interests involved in the present system in his recommendations for gradual, step-by-step implementation of no-fault over a period of years.

Dartmouth Professor of Economics, Mr.Baldwin teaches the following courses:Industrial Organization and Public Policy,Economic Risk and the Corporation, andPrinciples of Accounting.