Private Law Theory

ABSTRACT
This Article advances a novel theory of social insurance capable of explaining the moral function of this system and its relation to tort law. For half a century, tort theory has been organized around two questions: What is tort law for, and what should the institution look like? The proposal to replace tort law with a social insurance scheme implicates both questions. Law and economics scholars, who see tort as a system for minimizing the costs of accidents, possess a theory of both tort and social insurance, and so can reason richly about how the two relate. Philosophical tort theorists, who understand tort as a vehicle of interpersonal justice, cannot. These theorists lack a satisfactory theory of social insurance. Failing to grasp social insurance’s true function has led them to dismiss such schemes as irrelevant at best and, at worst, a betrayal of tort’s redressive mission.

This Article argues that the dismissal rests on a mistake, and that correcting it transforms what tort theorists can imagine and demand. Existing philosophical accounts treat social insurance and tort law as rivals; either social insurance serves some unrelated end, such as distributive justice, or it pursues tort’s own aims so directly that it could simply replace it. Moreover, all existing theories treat the two systems are mutually exclusive; adopting social insurance necessitates discarding tort law and vice versa. My theory shows these foundational assumptions to be incorrect. Tort law and social insurance play distinct but complementary roles in the pursuit of humane interpersonal justice. Tort law plays a facilitative role, giving victims access to a civilized mode of accountability: money damages. Social insurance plays what I call a transformative role: By absorbing the financial consequences of wrongdoing, it changes what counts as accountability in the first place, letting victims hold wrongdoers to account while demanding less of them, and letting wrongdoers discharge their duties more easily. Simply put, accountability and compensation, long treated as inseparable, can come apart.

And they should. My argument reveals that the field’s organizing assumption – that we must choose between tort and social insurance – is a false choice. The two can easily be combined. I develop a hybrid system that layers tort-style accountability atop universal social insurance. I then argue that it achieves tort’s own aims more fully than our existing system does. Because so many of tort law’s deepest flaws – judgment-proof defendants, coercive settlement, porous private insurance, the crushing cost and delay of litigation – flow from its overreliance on money damages, severing the link between accountability and compensation ameliorates all of them at once. Most strikingly, the hybrid system’s advantages are greatest for reckless and intentional wrongs, precisely the cases in which theorists have insisted social insurance has no place.

The stakes of this debate reach far beyond tort theory. At a moment when technological change is once again straining our liability regimes, when theorists are once again beginning to discuss altering key aspects of our system, the Article gives us the theoretical tools necessary to think ambitiously about our legal system and its aspirations to justice. Social insurance, properly understood, is not tort’s rival but its ally – and recognizing as much reveals that the choice we have debated for fifty years was never a choice at all.

Seidenberg, Ethan, Accountability Without Damages: Social Insurance, Tort Law, and Interpersonal Justice (July 21, 2026).