Professionals' Liability Insurance Reform Act of 1986

Professionals' Liability Insurance Reform Act of 1986 - Requires each State to have in effect certain tort liability standards prescribed by this Act within four years after the date of enactment.

Prescribes certification procedures for the Secretary of Commerce to follow after determining that a State's tort liability standards substantially comply with the standards prescribed by this Act.

Prescribes tort liability standards and court procedures which include: (1) a court-appointed special master who shall hold a hearing to evaluate the merit of a claim pending in a civil action, and who shall attempt to facilitate settlement of such claim according to certain guidelines; (2) a court determination whether there is any basis for imposing sanctions against an attorney if discovery in a civil action is not concluded during the one-year period beginning on such action's commencement date; (3) a court-administered arbitration program; (4) a plan to conduct discovery under the supervision of the special master; (5) a periodic payments schedule in any civil action in which a State court awards an individual damages for future pain and suffering or for loss of earnings in excess of $100,000; (6) a specified reduction in the amount of damages awarded by a State court if the compensated individual receives additional compensation benefits from certain sources; (7) a limitation of $250,000 placed upon any award for damages for noneconomic losses resulting from malpractice; (8) a limitation placed upon attorneys' fees based upon a specified decreasing percentage scale; (9) a holding of liability only for that part of fault which is attributable to a party to the claim; and (10) court-imposed pecuniary sanctions upon an attorney whose conduct has been judicially determined to either have been in bad faith or calculated to delay resolution of the claim.

Permits a State whose certification has been denied or revoked to request a hearing before an administrative law judge.

Urges each State to encourage professional organizations to implement risk management programs which comply with State laws and are acceptable to the State agency responsible for licensing or certifying professionals who practice in the State.

Requires each State to report to the Secretary of Commerce regarding: (1) the effect of such State's tort liability standards upon the availability and affordability of liability insurance for professionals practicing within the State; and (2) problems regarding professional liability and professional liability insurance which have not been alleviated by, or which have been caused by, such standards. Requires the Secretary to transmit to certain congressional committees a report summarizing the information submitted by the States.