Category Archives: Legal Environment

Affordability, Legal Environment

Legal System Abuse Awareness Campaign Spreads Across U.S.

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By Jeff Dunsavage, Head of Research Publications and Insights, Triple-I

Triple-I’s awareness-building campaign around legal system abuse and its impact on consumers and businesses – including driving up insurance premiums – continues to spread across the nation.

Over the past several weeks, brick-and-mortar highway billboards and digital displays have appeared in areas of Missouri, Oklahoma, and Wisconsin. This follows the campaign’s February expansion into California and Illinois. Kicked off in 2024 in the Capitol District of Atlanta, the campaign also includes a dedicated online consumer-education resource:  StopLegalSystemAbuse.org and targeted social media messaging.

By demonstrating the direct link between lawsuit abuse and increased insurance premiums, Triple-I aims to catalyze legislative action and economic relief.

 “We have already seen how meaningful tort reform in states like Florida, Georgia, and Louisiana can stabilize the insurance market and provide direct financial relief to consumers,” said Triple-I CEO Sean Kevelighan. “Triple-I remains committed to educating lawmakers and the public on the high cost of legal system abuse, addressing the critical issue of affordability for families, and driving legislative progress that restores balance to the national economy.”

The pain is real

Affordability – including insurance costs – is a nationwide issue, and consumers’ pain is real. Unfortunately, many legislative proposals aimed at easing that pain would have the opposite effect.  As Bloomberg warned in a January 2026 editorial, policymakers should resist politically popular but “simplistic solutions, such as capping premiums, subsidizing homebuyers, or punishing investors.”

Instead, it recommends taking steps to increase investment in catastrophe resilience and mitigate cost drivers like legal system abuse.

“In many states,” the editorial said, “underwriters must contend with laws that favor plaintiffs, outsized jury awards, and a proliferation of funds that specialize in financing lawsuits. Research suggests that such costs have been the single biggest driver of premium increases in recent years.”

Also feeding higher premiums are increased replacement costs related to inflation.

Model what’s working

As policymakers seek ways to address these influences, it’s important to learn from states that are succeeding. Florida has a long history of man-made problems caused by insurance fraud and litigation abuse that have contributed to upward pressure on insurance rates. More recently, the state’s legislative reforms to address fraud and tort reform have made the Sunshine State a national model for getting at the root causes of high premiums, instead of merely treating the symptoms.

Since reforms were enacted following a 2022 special session of the Florida Legislature, nearly 20 new property insurers have entered the state and existing carriers have expanded their market share, driving renewed private competition. That shift has facilitated a deep reduction in the number of policies administered by Citizens Property Insurance Corp. – the state-run insurer of last resort.

Other states would do well to pay attention to Florida’s blueprint and learn from these and other successes.

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Homeowners Insurance, Insurers and the Economy, Legal Environment

Lessons for Texas in Florida Legal Reforms

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By Lewis Nibbelin, Research Writer, Triple-I

Texas lawmakers struggling to ease the state’s rising insurance costs might find useful insights from Florida’s sustained commitment to legal system abuse reform.

In recent years, Florida led the nation in claim-related litigation, accounting for 72 percent of homeowners’ insurance lawsuits despite representing only 10 percent of homeowners’ claims. This disparity fueled escalating premium rates and a multi-year insurer exodus, steering state lawmakers toward litigation reforms in 2022 and 2023. These reforms, among other things, curtailed one-way attorney fees and assignment of benefits (AOB) for property insurance claims.

Post-reform, dozens of homeowners’ and auto insurers have filed for premium reductions in the state, with some carriers filing cumulative reductions of more than 20 percent. Renewed market competition from the 18 new property insurers in the Sunshine State also facilitated the lowest number of policies administered by Citizens Property Insurance Corp. – the state-run insurer of last resort – in over a decade, at a 50 percent drop last year from 2024 due to successful depopulation to the private market.

Florida’s growing stability reflects a steady decrease in nuclear verdicts (awards of $10 million or more) and claims-related lawsuits, with every month of 2025 reporting a continued decline in newly filed litigation compared to the same month the previous year, the state governor’s office said in a statement.

Texas insurance premiums spiral

Unlike Florida’s trajectory, Texas once set the gold standard for a fair and balanced court system, leading with a series of 1990s and early 2000s reforms that included a $250,000 cap on noneconomic damages in medical malpractice cases. While this legislation remains intact, continued efforts have stalled under repeated legislative challenges to preexisting and proposed reforms.

Last year’s failed state Senate Bill 30, for instance – based on a similar Florida measure – aimed to restrict “phantom damages” by showing juries the actual amount paid for medical bills, rather than an inflated amount determined by a healthcare provider’s list prices. Such amounts contribute to outsized damage awards in the state, which hosted the highest volume of U.S. nuclear verdicts in 2024.

Insurers must account for these added costs when setting rates, leading to a 19 percent increase in average Texas homeowners’ insurance rates in 2024 after a 21 percent spike in 2023, according to Texas Department of Insurance data. Research from the Insurance Research Council – an affiliate of The Institutes, like Triple-I – ranked Texas as the sixth least affordable state for homeowners’ insurance in 2022, with homeowners on average paying 3.13 percent of median household income for coverage.

These trends earned Texas a spot on the American Tort Reform Foundation’s (ATRF) annual “Judicial Hellhole” watch list last year, which highlighted “a wave of industry-targeted lawsuits” within the state. Noting that excess litigation also costs Texans an average of $1,724 each year, ATRF president Tiger Joyce argued “Texas courts are in jeopardy — and it’s hardworking families who pay the price for lawsuit abuse.”

Texas policymakers would do well to build on the state’s track record of meaningful reform and continue pushing for legislation modeled on Florida’s success. Because the Texas Legislature will not meet again until January 2027, the Lone Star State will remain a difficult litigious environment for defendants and insurers alike for some time.

Learn More:

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Auto Insurance, Coastal Property, Homeowners Insurance, Insurers and the Economy, Legal Environment

Florida Premiums Drop Amid Post-Reform Stability

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By Lewis Nibbelin, Research Writer, Triple-I

Legislative reforms to address claim fraud and legal system abuse in Florida have continued to help stabilize the state’s property/casualty insurance market, contributing to premium reductions for thousands of homeowners and drivers, according to the latest Triple-I Issues Brief.

Since the reforms, nearly 20 new property insurers have entered the state and existing carriers have expanded their market share, driving renewed competition in the private market. This shift facilitated the lowest number of policies administered by Citizens Property Insurance Corp. – the state-run insurer of last resort – in over a decade, after a 50 percent drop in policies in force from 2024.

Claims-related litigation has also plummeted, with insurance litigation filings down 23 percent year-over-year from 2023 to 2024. Filings then fell 25 percent during the first half of 2025, compared to the same period in 2024, and remain below pre-2018 levels, as reported by the state governor’s office.

Florida’s reforms were enacted in 2022 and 2023, at a time when the state accounted for 72 percent of the nation’s homeowners claim-related litigation but only 10 percent of homeowners claims. The disparity reflected escalating premium rates and a multi-year insurer exodus, steering state lawmakers toward litigation reforms that, among other things, curtailed one-way attorney fees and assignment of benefits (AOB) for property insurance claims.

Ongoing market momentum

The impact of the reforms is particularly evident in Florida’s auto insurance market, which recorded the lowest personal auto liability loss ratio in the nation – and the state’s lowest in 15 years – in 2025, at 52.5 percent, according to the OIR. The market’s physical damage loss ratio also fell to 49.5 percent, reflecting a steady decline from 112.0 percent in 2022.

Such stability produced extensive savings for Florida drivers in 2025, with the state’s top five auto insurance groups averaging a more than 6 percent rate reduction through mid-year, accounting for 78 percent of the state’s auto market. These reductions have increased to an average of 8 percent based on the most recent 2026 regulatory filings.

Homeowners are also experiencing relief after more than 185 residential filings for flat or decreased rates over the past two years, the OIR reported. Rate changes have continued to flatten in the state after years of tracking the upward trend of rates nationally.

Lower reinsurance costs factor into this finding, translating to a 10.7 percent price decrease overall on reinsurance in 2025, according to a Gallagher Re report on the sustained success of Florida’s reforms.

“Hurricanes Helene and Milton, two powerful and destructive storms that hit Florida in September-October 2024, also provided a useful – if unwanted – test case for the reforms’ efficacy,” the report added. “Many insurers ceded losses on layers below the state’s catastrophe fund, but despite this, there was more reinsurance capacity than expected available for these layers.”

Learn More:

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Florida Senate Rejects Legal-Reform Challenge

Affordability, Auto Insurance, Insurers and the Economy, Legal Environment

Uber Joins Effort to Drive Legal System Reform

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By Lewis Nibbelin, Research Writer, Triple-I

Ridesharing platforms like Uber are as vulnerable as other businesses to the cost impacts of legal system abuse – costs that inevitably are passed along to their customers. The company reported a more than 50 percent increase in its ride insurance costs per trip in recent years, despite also recording a lower rate of overall crashes from 2017 to 2022.

Passengers see these costs reflected in trip prices, with insurance accounting for roughly 10 percent of the average rider fare nationwide, or as high as 47 percent in costlier areas like Los Angeles County.

“Insurance for us is the second-highest operating cost after payment to drivers,” said Adam Blinick, Uber’s senior director of public policy and communications, in a recent Executive Exchange interview with Triple-I CEO Sean Kevelighan. “It’s been a bit of a calling card to get more aggressive on litigation and being public about where we see the abuse.”

Coordinated attorney outreach helps fuel the trend. Among motor accident victims surveyed by Protecting American Consumers Together, attorneys contacted 92 percent after their accident, including 57 percent who reported they were contacted by more than one. Solicitation typically occurred within a week of the incident, or “before insurance can play a part in addressing someone’s concerns,” Blinick noted.

“This creates more avenues to push people into these mills and artificially inflate the value of claims,” he said.

Third-party litigation funders play a major role in recruiting claimants. Though lack of transparency surrounding the market conceals its true size, a recent report from the National Insurance Crime Bureau and 4WARN estimates third-party funders spent more than $380 million on online search ads alone between June 2024 and June 2025, with some engaging in brand impersonation and search engine manipulation to mislead consumers and extend litigation.

Research from Triple-I and the Casualty Actuarial Society (CAS) estimates excessive litigation added $231.6 billion to $281.2 billion in liability insurance losses from 2015 to 2024, a finding that economic inflation alone cannot explain. A separate Triple-I report on civil case filings reinforces the finding, revealing approximately $42.8 billion in excess litigation value from motor vehicle tort cases filed between 2014 and 2023 in the federal and state civil courts.

“That’s a drop in the bucket to the reality of the problem,” Kevelighan said, “because less than 10 percent of cases had judgments. Others were settled and we can’t necessarily track the settlement data.”

Blinick discussed how uninsured and underinsured motorist (UM/UIM) insurance limits can also attract high claim volumes and disputes, particularly for the rideshare industry. Multiple states require ridesharing businesses to pay $1 million or more for such coverage, with limits in New York set at $1.25 million. Though intended to provide relief for policyholders hit by UM or UIM, these requirements mean bad actors stand to win more from claims, incentivizing excessive lawsuits and fraud.

Staged crashes generate many such claims, with some schemes involving a network of rideshare passengers who are “tied to the law firm, the medical providers, the body shops, the lenders themselves… all across the board,” Blinick said.

He added that many offenders “are the same ones who are doing slip and fall claims and mass tort suits against cities and counties. They’re not picky in terms of who they’re going after. They’re going wherever the opportunity presents itself.”

A 2025 California law that went into effect this year aims to help mitigate fraud by reducing the rideshare industry’s UM/UIM coverage limits from $1 million to $300,000 per accident. Uber has also submitted a November 2026 ballot measure that would cap contingency fees and limit medical damages in vehicle accident cases within the state, as well as shown support for New York’s 2027 budget proposals to combat fraud and unnecessary litigation.

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Affordability, Artificial Intelligence, Insurers and the Economy, Legal Environment

Legal System Abuse, Artificial Intelligence Cloud 2026 Outlook

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By Lewis Nibbelin, Research Writer, Triple-I

Though U.S. economic growth in the coming year remains strong, an ongoing rise in legal system abuse and emerging AI trends may challenge that outlook, according to Chubb chairman and CEO Evan Greenberg in a recent letter to shareholders.

Describing the 2026 market outlook as a “mixed picture,” Greenberg explained that, despite growth drivers like innovation investments and federal deregulation efforts, these gains face challenges from the “cancer” of excessive litigation, which raises costs on “just about everything – transportation, food, construction, insurance and more.” Such expenses amount to an average “tort tax” of $4,000 annually per household, Greenberg argued, and inflate liability insurance costs up 7 percent to 9 percent a year.

“The trial bar is a money-making growth industry, and it continues to expand as lawyers search for new theories of liability to bring more lawsuits,” Greenberg said, adding that third-party litigation funders (TPLF) help turn “courtroom payouts into a speculative asset class.”

Florida has made substantial progress in mitigating these costs through its 2022 and 2023 reforms, contributing to a $4.2 billion increase in business activity and the creation of more than 29,000 jobs, the Perryman Group estimates. Several states, including Georgia, Louisiana, and New York, have also enacted legislation establishing greater oversight of TPLF, spurring similar legislative momentum on a federal level.

Greenberg emphasized the need for continued reforms as courtroom imbalances persist nationwide, noting “it will be a long fight” before policyholders begin to see their impact on insurance premiums and other costs.

Accommodating a digital age

Rapid advancements in AI have bolstered productivity “in all aspects of the underwriting and claims processes,” Greenberg said, facilitating deeper insights, improved customer experiences, and new product innovations. Integrating AI into the insurance industry, however, poses unique hurdles, particularly as companies grapple with an expanding talent gap.

AI adoption can help attract professionals who may otherwise overlook the industry, but upskilling and reskilling current employees is essential to push adoption forward. By investing in AI skill development, such expertise can be paired with “business professionals and managers who know intimately how the business works and what’s required for change,” Greenberg explained.

While any major tech transformation demands “iterative, gritty work,” Greenberg reiterated “the stronger our competitive profile, the more we will grow, which means more employment over time with higher productivity. And remember, when it comes to most insurance, people still want to deal with people. It’s a trust business.”

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Affordability, Legal Environment

Triple-I Legal System Abuse Awareness Campaign Enters California, Illinois

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By Lewis Nibbelin, Research Writer, Triple-I

As part of its continuing effort to highlight the impacts of legal system abuse, Triple-I has launched public awareness campaigns on the need for legal reforms in Los Angeles, Calif., and Cook County, Ill., which includes Chicago. The campaigns comprise brick-and-mortar billboards and digital scapes in high-traffic areas across both regions, all of which promote Triple-I’s updated StopLegalSystemAbuse.org microsite.

California and Illinois are perennial members of the American Tort Reform Foundation’s (ATRF) annual list of “judicial hellholes,” or jurisdictions where the organization believes legal system abuse runs rampant. Los Angeles topped its most recent list due to frequent nuclear verdicts and “novel theories of product and environmental liability” to the disadvantage of defendants, ATRF says, with Cook County ranked seventh.

A consumer guide co-authored by Triple-I and Munich Re outlines how such practices fuel rising insurance premiums and other cost burdens throughout the country, to the tune of $6,664 in added annual costs for an American family of four and 4.8 million in jobs lost nationwide. Per resident, these annual costs amount to $2,566.70 in California and just over $2,000 in Illinois, with both states losing hundreds of thousands of jobs every year.

Billboard lawyers blur reality

Attorney advertising often obfuscates this reality, implying plaintiffs win big rather than receive only a fraction of awarded damages. Triple-I’s most recent Issues Brief on legal system abuse notes that legal service providers spent $2.5 billion on millions of ads in 2024 largely to tout this messaging, which research suggests increases the number of plaintiffs in multidistrict litigation (MDL), or large, complex lawsuits consisting of multiple civil cases in different districts.

Additional research from Triple-I and the Casualty Actuarial Society (CAS) estimates that excessive litigation drove $231.6 billion to $281.2 billion in increased liability insurance losses from 2015 to 2024, a finding that economic inflation alone cannot explain. A separate Triple-I report on civil case filings reinforces the trend, revealing an estimated $42.8 billion in excess litigation value from motor vehicle tort cases filed between 2014 and 2023 in the federal and state civil courts.

Gaining momentum

Triple-I’s new campaigns build on the momentum of its parallel efforts in Georgia and Louisiana, where state lawmakers successfully passed sweeping legal system abuse reforms last year. Both states, for instance, have established greater oversight of third-party litigation funding to prevent outside investors from gaming the court system for profit. Though the reforms remain too recent to fully affect premiums, legal reforms in Florida model the kinds of subsequent market improvements these states can later expect.

Families and businesses across the country are grappling with rising costs. By distorting loss trends and propelling claims expenses, unnecessary and drawn-out litigation serves only to exacerbate the strain. Addressing these pressures requires ongoing dialogue between regulators, consumers, industry leaders, and other stakeholders to ensure fairness in the court system while supporting a stable insurance environment that keeps coverage accessible.

Learn More:

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New Triple-I Issue Brief Puts the Spotlight on Georgia’s Insurance Affordability Crisis

Homeowners Insurance, Insurers and the Economy, Legal Environment

Take Care in Addressing Homeowners’ Premiums, Bloomberg Cautions Policymakers

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By Jeff Dunsavage, Senior Research Analyst, Triple-I

While rising homeowners’ insurance can be a problem for some consumers, a recent Bloomberg editorial cautions policymakers against pursuing “simplistic solutions, such as capping premiums, subsidizing homebuyers, or punishing investors.”

Instead, it recommends taking steps to increase investment in catastrophe resilience and mitigate claim cost drivers, such as legal system abuse.

Bloomberg attributes slumping condominium prices and rising rents, in part, to increasing homeowners’ insurance premiums.

“Average homeowners insurance premiums rose almost 25 percent from 2019 to 2024 in real terms,” the editorial says. While politicians “have been quick to blame greedy insurers,” the reality is more complicated. Contributing factors include:

  • Increasingly costly disasters – evidenced by a sharp increase in billion-dollar catastrophes. In 2025, Bloomberg says, insured losses from such calamities reached $108 billion.
  • Insufficient investment by states in disaster resilience measures, “such as retrofitting public works and enforcing appropriate building codes”.
  • Escalating legal costs that are passed on to homeowners.

“In many states,” Bloomberg says, “underwriters must contend with laws that favor plaintiffs, outsized jury awards, and a proliferation of funds that specialize in financing lawsuits. Research suggests that such costs have been the single biggest driver of premium increases in recent years.”

Also feeding higher premiums are increased replacement costs related to record inflation during and since the COVID-19 pandemic.

In attempts to address these rising costs, several states in recent years have introduced legislative measures that would do more harm to homebuyers than good. Illinois insurers last year narrowly avoided increased government involvement in insurance pricing as state legislators rejected “an extreme prior-approval system found nowhere else in the country,” according to a joint statement from the American Property Casualty Insurance Association, the National Association of Mutual Insurance Companies, and the Illinois Insurance Association.

When California tried to artificially suppress premiums, “underwriters fled the market and left homeowners and the state’s insurer of last resort exposed to last year’s horrific wildfires”.  Since then, the state has allowed significant premium rate increases to lure insurers back.

Bloomberg recommends that states start by prioritizing the resilience of buildings and public works.

“Tax breaks and grants for hardening homes against floods, fire, and wind are a short‑term expense with long‑term benefits,” the editorial says, citing research that found communities lose as much as $33 in future economic activity for every $1 not invested in preparedness.

“The federal government, for its part, should commit to restoring FEMA’s pre‑disaster mitigation program and similar efforts,” Bloomberg says. “With strong oversight, such investment can protect property, limit job losses, accelerate rebuilding, reduce premiums, improve public health, and ultimately save money and lives.”

When it comes to litigation trends that put upward pressure on claim costs and, ultimately, premium rates, Florida offers an encouraging example.

“In 2021, the state was home to 6.9 percent of homeowner claims but 76 percent of the lawsuits against insurers,” Bloomberg says. “State lawmakers enacted reforms over the next two years that limited plaintiffs’ ability to allege negligence and recoup expenses, with significant results: At least 17 new insurers entered the market and dozens reduced premiums.”

Triple-I, its members, and its partners have long been engaged in helping policymakers and the public understand the forces that affect insurance affordability and availability and how they can help mitigate the factors that drive up costs.  

“It’s refreshing to see this type of thoughtful analysis of the homeowners’ insurance market by an authoritative financial news organization like Bloomberg,” said Triple-I CEO Sean Kevelighan.  “Consumers and policymakers need to understand that higher premiums are a symptom of the current risk environment, not its cause.”

Learn More:

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Affordability, Auto Insurance, Insurers and the Economy, Legal Environment

New York Among
Least Affordable States for Auto Insurance

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By Lewis Nibbelin, Research Writer, Triple-I

New Yorkers pay the fourth-highest personal auto expenditures in the United States, costing households an average of $1,935 in 2024, or 2.23 percent of the state’s median household income, according to Triple-I’s latest Affordability Outlook.

Up from New York’s average of $1,753 in 2023, Triple-I’s estimates reflect the burgeoning toll of several expenditure cost drivers in the Empire State, many of which are structural factors beyond the insurance industry. Citing data from the Insurance Research Council (IRC) – like Triple-I, an affiliate of The Institutes – the report highlights four cost drivers that rank among the highest in the country, including:

  • Repair costs: New York has the third-highest auto repairs costs in the United States, at $864 more than the national average;
  • Carrier expense index: New York has the third-highest carrier expense index for personal auto insurance, at 14.9 percent of losses;
  • Injury claim costs: New York has the third-highest average injury claim severity in the country, at more than twice the national average; and
  • Accident frequency: New York has the eighth-highest average frequency of personal auto accidents in the nation, at 3.09 accidents.

While traffic density, road conditions, and driver education can contribute to accident frequency and severity, excessive and fraudulent claims litigation also fuel rising auto insurance premiums and overall costs in the state. Wiping out billions of dollars in U.S. economic activity annually, legal system abuse costs New York residents 427,794 jobs and $7,027 for each household per year, earning the state a recurring spot on the American Tort Reform Foundation’s list of “judicial hellholes.”

A surge in staged crashes underpins these figures, leaving drivers increasingly vulnerable to fraudulent damage or injury claims. Such incidents – totaling 1,729 in New York in 2023 – keep upward pressure on auto rates for all policyholders, inflating average auto premium by as much as $300 per year, Triple-I estimates.

To alleviate these cost burdens, a package of state budget proposals was recently unveiled to secure $2 million in funding for investigations into alleged auto fraud and introduce new regulations that extend the timeframe for carriers to report suspicious claims. Another law would cap pain and suffering damages awarded to drivers who engaged in criminal behavior, such as those who were uninsured at the time of the incident.

New York policymakers also passed legislation last month aimed at third-party litigation funding (TPLF), or funding from often anonymous investors who can delay prompt settlements in exchange for a share of larger damage awards, thereby propelling claims costs. Though falling short of mandating TPLF disclosure during litigation, the new law parallels effective tort reforms in other states, offering hope toward insurance market stability.

Homeowners insurance holds steady

Conversely, New York’s homeowners insurance premiums “are relatively average and reasonable as a percentage of household income,” contradicting “the narrative of an affordability crisis in New York’s homeowners insurance market,” said Patrick Schmid, Triple-I’s chief insurance officer, in written testimony to state lawmakers.

With a 2.11 percent ratio of homeowners insurance expenditure to median household income, New York ranks 29th in an affordability study by the IRC, suggesting property and replacement costs contribute to the state’s housing affordability issues.

Policy interventions in insurance markets “would address a symptom rather than the cause” of such issues, Schmid stressed, urging lawmakers to focus instead on improving building material and labor costs; litigation trends; and other inflationary pressures.

While the specific policy levers may differ, Florida’s legal reforms in 2022 and 2023 led to 17 new insurance companies entering the state and rate reductions for dozens of homeowners and auto insurers, including a 6.5 percent average rate decrease for the state’s top five personal auto insurers in 2025.

Once a “poster child” for legal system abuse, Florida’s success demonstrates the need for continued reform in 2026 to promote a more competitive insurance market and greater affordability for consumers.

Learn More:

Triple-I Testifies on New York Insurance Affordability

Florida Governor Touts Auto Insurance Rebates, Tort Reform Success

Litigation Reform Works: Florida Auto Insurance Premium Rates Declining

Insurance Affordability, Availability Demand Collaboration, Innovation

Disasters, Litigation Reshape Homeowners’ Insurance Affordability

Affordability, Auto Insurance, Insurers and the Economy, Legal Environment, Regulation

La. Auto Insurance Rates Benefit From Declines
in Frequency, Severity

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By Lewis Nibbelin, Research Writer, Triple-I

More than 20 requests for auto insurance rate decreases have been filed with Louisana’s Department of Insurance by insurers since mid-2025. According to the department, the decreases were driven by reductions in accident frequency and severity.

“I’m glad to see positive movement on auto rates in Louisiana for the first time in years,” said Louisiana Insurance Commissioner Tim Temple. “Because fewer accidents are contributing to these lower losses for insurers, we should not necessarily expect to see this level of decrease in future years unless we continue to pursue legal reform that addresses the foundational reasons our rates are the highest in the country.”

Temple said he hopes for further rate changes as the market continues to stabilize, citing Florida’s recent premium reductions after sweeping tort reform legislation in 2022 and 2023.

Longstanding affordability challenges

Among those who filed for rate decreases include Louisiana’s largest auto insurers, with the latest reductions impacting nearly 470,000 Progressive policyholders, or roughly 23.5 percent of the state’s auto market. More than one million State Farm policies also achieved lower average rates implemented this month.

While the statewide decreases can offer relief for drivers in one of the least affordable states for auto insurance, Temple cautioned that rates for individual policyholders will differ based on personal risk factors, urging consumers to shop among the “30 companies that have taken a rate decrease.”

The announcement arrives less than a year after Louisiana lawmakers passed a 2025 tort reform package to curb excessive lawsuits and a rate of bodily injury claims more than twice the national average. Beyond fueling higher insurance premiums in the state, such practices generate an annual $965 “tort tax” on every Louisianan and cost over 40,562 jobs per year, as highlighted by Triple-I’s consumer awareness campaign to build support for the reforms.

Other 2025 legislative measures, however, stipulate increased regulatory intervention in rate-setting, which can create further strain on an insurance market just beginning to recover. Another bill targeting nuclear verdicts (awards of $10 million or more) also failed to pass, playing a role in the state’s recurring spot on the American Tort Reform Foundation’s annual list of “judicial hellholes.”

Noting that reduced accident frequency contributed to the rate changes, Temple said in a statement that “we should not necessarily expect to see this level of decrease in future years unless we continue to pursue legal reform that addresses the foundational reasons our rates are the highest in the country.”

Lessons from Florida

Measurable benefits from Louisiana’s existing reforms may require a few more years to unfold, Temple added, based on the trajectory of similar legislation in Florida. In 2022, Florida accounted for over 70 percent of the nation’s homeowners claim-related litigation, despite representing only 15 percent of homeowners’ insurance claims, according to the state’s Office of Insurance Regulation (OIR). State legislators responded to the crisis with several tort laws that, among other things, eliminated one-way attorney fees and assignment of benefits (AOB) for property insurance claims.

Under the reforms, 17 new insurance companies have entered the Sunshine State and dozens of homeowners’ and auto insurers have filed for rate decreases, with Citizens Property Insurance – the state’s insurer of last resort – approved for major average rate cuts this spring, according to a recent announcement from Florida Gov. Ron DeSantis.

A 50 percent drop in Citizens policies in 2025 helped facilitate the cuts, reflecting the largest transition of policies back to the private market in a decade. Later that year, additional cost-savings achieved through the reforms helped state regulators secure nearly $1 billion in premium refunds for Progressive auto insurance policyholders in the state.

Though the specific policy levers may differ, Florida’s reforms continue to model the kinds of market improvements that states like Louisiana and Georgia can expect after successfully passing their own tort legislation. State government moves like these are essential to eradicating legal system abuse and keeping insurance affordable and available, especially as legislative challenges to legal reform persist.

“Premiums are lowering because we’ve enacted real reforms and withstood the pressure to reverse course,” DeSantis said. “We will hold firm in our commitment not to go back to the broken insurance market of the past.”

Learn More:

Significant Tort Reform Advances in Louisiana

Florida Governor Touts Auto Insurance Rebates, Tort Reform Success

Litigation Reform Works: Florida Auto Insurance Premium Rates Declining

Louisiana Senator Seeks Resumption of Resilience Investment Program

Louisiana Reforms: Progress, But More Is Needed to Stem Legal System Abuse

Who’s Financing Legal System Abuse? Louisianans Need to Know

Auto Insurance, Business Insurance, General Liability, Legal Environment

Claims Severity Drives Liability Insurance Losses

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By William Nibbelin, Senior Research Actuary, Triple-I

Economic and social inflation have added a staggering $231.6 billion to $281.2 billion in increased liability insurance losses and Defense and Cost Containment expenses in auto and general liability lines, a new report by Triple-I and the Casualty Actuarial Society.

The study – The Impact of Increasing Inflation on Liability Insurance 2015 – 2024 – says this structural rise in loss costs is amplified by what is broadly identified as legal system abuse.

The dual engine of increasing inflation

The analysis focuses on the total impact of increasing inflation determined through actuarial methods that are unable to decompose the precise contribution of economic inflation versus the role of what Triple-I characterizes as “legal system abuse” — policyholder or plaintiff attorney practices that increase costs and time to settle claims to the detriment of consumers, businesses, and the economy.  These practices include increasing litigiousness, third-party litigation financing, and soaring jury awards.

Claim severity powers losses

Across all lines analyzed, claim severity – not frequency – emerges as the primary driver of the escalating losses in liability lines of insurance. While the number of claims (frequency) has either generally declined or remained below pre-pandemic levels across the study period, the average cost per claim (severity) has soared. In commercial auto liability, for example, frequency has fallen dramatically since the pandemic, yet losses have still increased relentlessly because severity has risen 93.5 percent between 2015 and 2024.

Auto Liability

The report’s traditional focus on auto liability lines continues to show the most significant dollar-based impacts.

  • Personal auto liability: Increasing Inflation added between $91.6 billion and $102.3 billion to losses and DCC for the 2015–2024 period. This represents 8.7 percent  to 9.7 percent of losses and DCC for the period and an increase of 20 percent to 26 percent from the previous analysis on years 2014 through 2023. While the implied compound annual impact is lower than in the commercial sector, the dollar amount is huge due to the line’s immense underlying size. Personal auto severity has accelerated significantly post-2019, nearly tripling its compounded annual growth rate to 10.9 percent from 2019 to 2024. Premiums are only just beginning to rebound from pandemic-era lows, lagging the rise in losses.
  • Commercial Auto Liability: This line continues to sustain higher inflation rates in percentage terms. The total impact of increasing inflation reached $52.0 billion to $70.8 billion (22.6 percent  to 30.8 percent of booked losses). This represents an increase of 22 percent to 27 percent from the previous analysis.

A compelling cross-data set comparison with the Triple-I 2025 report, Review of Motor Vehicle Tort Cases Across the Federal And State Civil Courts, suggests that the “excess value” extracted by motor vehicle tort lawsuits—a clear measure of legal system abuse—was approximately $42.8 billion between 2014 and 2023. This quantitative finding suggests legal system abuse accounts for roughly one-third of the total Increasing Inflation effect in auto liability losses.

General liability lines

This year’s analysis expands to quantify the impact across broader general liability lines for the first time, revealing inflationary rates that are equally, if not more, dramatic in percentage terms.

  • Other Liability – Occurrence: Increasing inflation added between $83.4 billion and $103.3 billion to losses and DCC for the 2015–2024 period. This inflationary problem is comparable in dollar terms to personal auto liability, despite having only about one-third of the loss volume. Its implied annual impact of 3.7 percent on a paid basis is the highest of all the lines studied. Severity in this line grew at a compound annual rate of 6.8% from 2015 to 2024, far outpacing the Consumer Price Index All-Urban (CPI-U).
  • Product Liability – Occurrence: Increasing inflation added between $4.6 billion and $4.8 billion to losses and DCC for the 2015–2024 period. The smallest line examined exhibits the most dramatic severity trend with a compound annual growth rate of 22.3 percent between 2015 and 2024, resulting in a 512.5 percent severity increase overall. The effects appear to be accelerating, with the impact on Accident Year 2024 alone estimated at over 50% of that year’s booked losses.

For the “claims-made” categories of these liability lines (“other liability” and “product liability”), the study was unable to develop credible quantitative estimates due to shifts in business mix, data variability, and the inherent heterogeneity of the underlying risks. However, these lines have certainly not escaped the increasing inflationary environment.

Looking ahead

The data confirms a difficult truth: Even as general consumer price inflation (CPI-U) moderated to 3.0 percent in 2024—a reduction from the 2021-2023 average of 5.6 percent—the loss inflation in liability insurance remains structurally elevated. This means the economic tailwinds that temporarily exacerbated the problem are lessening, but the foundational issues of legal system abuse persist, locking in a higher rate of loss for the foreseeable future.

For consumers and businesses, this translates directly into higher premiums and a greater strain on their financial well-being. The challenge for insurers is the need to adapt to an elevated inflationary environment to effectively manage future liabilities. Recognizing and addressing the pervasive influence of legal system abuse is therefore essential for both managing risk and protecting consumers and businesses from ever-rising costs.

Triple-I continues to foster a research-based conversation around legal system abuse. For an overview of the topic and other helpful resources about its potential impact on insurers, policyholders, and the economy, check out our knowledge hub.