Life brings the unexpected—that’s why AHI’s insurance experts are in your corner. More Information Below!
Imagine a $100 million jury verdict wiping out your business overnight. That’s no nightmare—it’s today’s reality. Litigation costs are exploding, thanks to “nuclear verdicts” (massive jury awards) and third-party funding, where investors bankroll lawsuits for profit. For business owners, this isn’t just a legal risk—it’s a financial gut punch. Here’s what’s happening, why it’s hitting harder than ever, and your playbook to survive.
Picture this: a jury slams a trucking company with a $100 million verdict after one accident. Extreme? Not anymore. In 2023, there were 89 verdicts over $10 million, with 27 topping $100 million, per Marathon Strategies. These “nuclear verdicts” are fueled by social inflation—juries, swayed by outrage and social media, punish companies with jaw-dropping payouts. Transportation, manufacturing, and healthcare need robust business insurance and lawsuit protection now more than ever.
Then there’s third-party litigation funding, where investors bankroll lawsuits for a slice of the winnings. This multibillion-dollar industry turns plaintiffs into litigation machines, amplifying litigation costs. More lawsuits mean higher risk—funded cases chase bigger settlements or stretch out in court. Some funding even comes from foreign entities, raising security concerns, per the NC Chamber. Risk management is critical to counter this growing threat.
This isn’t your grandpa’s litigation landscape. Historically, big verdicts averaged $21 million from 2013-2022. Today, outliers hit $89 million, and third-party funding wasn’t even a factor a decade ago. Add modern jury tactics—like the “reptile theory,” painting companies as reckless—and it’s a perfect storm. Businesses without updated business insurance and risk management playbooks are scrambling in a game rigged against them.
Don’t panic—act. Here’s your playbook for lawsuit protection and risk management:
Common pitfalls in managing litigation costs:
The clock’s ticking on litigation costs. Audit your business insurance this week—ask your broker: “Can we survive a $50 million hit?” Then, schedule a risk management review. A few hours now could save millions in lawsuit protection later. Litigation costs aren’t just rising—they’re rewriting the rules. Stay sharp, stay covered, and don’t let a courtroom curveball take you down.
