A recent survey conducted by The Harris Poll, commissioned by the American Property Casualty Insurance Association (APCIA) and Munich Reinsurance America, Inc. (Munich Re US), reveals that a significant majority of Americans believe certain legal practices by plaintiff lawyers are driving up consumer costs, including insurance premiums. The survey, which included over 2,000 U.S. adults, highlights concerns about tactics such as excessive lawyer advertising, generating substantial jury awards, undisclosed third-party litigation funding (TPLF), and jury anchoring.
Key Findings on Legal Practices and Consumer Costs
- Lack of Awareness:
- 75% of respondents were unfamiliar with the term “jury anchoring.”
- 70% were unaware of “Third Party Litigation Funding (TPLF).”
- Perceived Impact on Costs:
- 69% believe that TPLF and jury anchoring practices will increase the overall cost of home, auto, and business insurance for all Americans.
- 66% agree that these tactics will also raise the cost of everyday items, including consumer goods.
Public Support for Legal Reforms
- 67% of respondents agree that state and federal lawmakers should implement restrictions on lawyer advertising to prevent misleading consumers and reduce the number of lawsuits filed.
- 68% feel that advertising large verdict payouts desensitizes people to high jury awards.
- 77% agree that allowing foreign investors to participate in U.S. civil claims and litigation could present a threat to national security.
- 78% believe that foreign investment in U.S. civil litigation should be prohibited.
Industry Leaders Advocate for Reform
Bonnie Guth, Head of Government Affairs at Munich Re America Services, emphasized the importance of raising awareness about how these legal practices impact consumers, “Allowing this abuse of the legal system to remain unchecked will likely persist and send improper signals to jurors, judges, and defendants about the value of damages. In turn, this can lead to higher insurance costs, financial strain on insurers and reinsurers, depletion of municipal resources, and disincentives for businesses to take risks.”
Stef Zielezienski, Executive Vice President and Chief Legal Officer at APCIA, highlighted the broader economic impact, “The misuse of the legal system fueled by plaintiff lawyer tactics, including misleading legal advertising, excessively high jury awards, third-party litigation funding, and jury anchoring, have promoted a litigious culture, which ultimately contributes to rising costs. This unchecked surge of litigation has had a far-reaching economic impact, costing the U.S. economy an estimated $529 billion and each household over $4,200. Reforms are needed to reduce consumer costs and improve insurance availability and affordability.”
The survey underscores a growing public consensus on the need for legal system reforms to address practices that contribute to increased consumer costs. As discussions continue, policymakers are urged to consider measures that promote fairness and predictability in the justice system.