The health of Georgia’s thriving community of Black-owned businesses is under threat.
Georgia has over
120,000 Black-owned businesses operating in the state, making up more than
11 percent of all businesses in Georgia. It’s the second-highest share of Black-owned businesses in the country, just behind Maryland.
But now, on top of longstanding challenges such as high inflation and
workforce shortages, there is a
mounting challenge for Georgia’s Black business owners: rising insurance premiums. Because of Georgia’s so-called “negligent security” law, which allows plaintiffs to sue small businesses for any crimes or harms committed on their properties — even if the business had nothing to do with them — Black-owned businesses are at risk of shutting down.
Black entrepreneurs face enough setbacks as it is.
47 percent of Black business owners who apply for loans are denied, compared to
34 percent of white business owners — reflecting systemic inequalities. Lack of financing is a large barrier to growing a business, but even those that are able to overcome these challenges are now facing higher costs that make running a business even more difficult.
For instance, Waffle House, one of Georgia’s most iconic companies, has seen its
insurance premiums rise 235 percent since 2018 due to the explosion of litigation affecting businesses across Georgia. While larger companies like Waffle House may be able to absorb some of those costs, many Black-owned small businesses will not be able to.
Black-owned businesses across the state, including grocery stores, restaurants, and health care providers, are at risk because of negligent security laws. If a Black-owned restaurant had someone trip and fall on its property, for example, it could be on the hook for payouts of up to $10 million. That’s devastating for any business, let alone a small minority-owned business already facing systemic hardship.
In order to protect Black communities in Georgia and the entrepreneurs who thrive here and make their neighborhoods stronger and more vibrant, there must be legal reform that keeps business insurance costs fair and sustainable.
Tort reform has been up for debate for years in Georgia, with reform efforts being introduced
as early as 2005. But this may finally be the year our state’s business see some relief. In February, the Georgia Senate passed SB 68, which would cap excessive payouts and protect businesses from unpredictable injury awards that can force closures and stifle growth. Through this reform proposal, frivolous lawsuits would also be capped — ensuring Georgia’s legal system is a tool for justice rather than one for financial exploitation.
A tort is a civil wrong that causes harm to a person or their property. Tort law is the body of rules that governs how to compensate victims of torts.
It is now up to the Georgia House to stand up for Georgia business owners, many of whom are struggling to keep their doors open in the wake of runaway jury verdicts. Without tort reform, more entrepreneurs, especially those in underserved communities, will be driven out of business. And that hurts our state’s vulnerable communities the most.
Bringing down costs for small business owners is a step forward for all communities, but especially for those that have been systemically and historically suppressed. Generational success is only possible when barriers to financial opportunity are removed. Tort reform is a key part of that.
Making it easier for Black-owned businesses to operate in Georgia helps to preserve the strong community they have built. Now, lawmakers can ensure that there is an even brighter future for Black entrepreneurship in Georgia by passing SB 68.
About Post Author
Atlanta Daily World
Atlanta Daily World stands as the first Black daily publication in America. Started in 1927 by Morehouse College graduate W.A. Scott. Currently owned by Real Times Media, ADW is one of the most influential Black newspapers in the nation.
