American Property Casualty Insurance Association (APCIA) -- THE COST OF LIVING IS RISING: LEGAL SYSTEM ABUSE IS A MAJOR, OFTEN OVERLOOKED REASON

WASHINGTON, May 12, 2026 /PRNewswire/ --

BACKGROUND
Americans are struggling with higher prices for everyday necessities – from groceries and gas to housing and insurance. One major factor often missing from the conversation is legal system abuse.

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When the civil justice system is exploited for profit instead of fairness, the costs don't stay in the courtroom. They ripple through the economy—driving up insurance premiums, increasing the price of everyday goods and services, and reducing affordable insurance coverage options for families and small businesses.

WHY IT IMPACTS EVERYONE
Legal system abuse functions like a hidden cost-of-living tax on households and businesses. Excessive litigation and rising legal costs force businesses to spend more just to operate – and those costs are ultimately passed on to consumers. As a result, the U.S. tort system costs the economy:

• Millions of jobs
• Hundreds of billions of dollars in lost economic output
• Higher prices and reduced purchasing power for households

For families, that adds up to nearly $6,000 per household every year in higher prices and fewer choices.

These costs show up where people feel them most— at the grocery store, at the gas pump, at their doctor's office, and in monthly insurance bills.

HOW LEGAL SYSTEM ABUSE DRIVES PRICES UP
Insurance works by pooling risk. When litigation costs explode—fueled by excessive verdicts, aggressive and misleading legal advertising, and third-party litigation funding – those costs are spread across policyholders – individuals, families, and businesses. Higher litigation costs mean:

• Higher insurance premiums
• Fewer affordable coverage options
• More financial strain on households and small businesses

And the problem is growing. The litigation funding market is projected to more than double in size over the next decade, raising concerns that more outside capital could add to pressure on the legal system and costs for consumers.

WHAT CAN BE DONE
Commonsense reforms can:

• Lower costs for families
• Improve insurance affordability and availability
• Restore balance to the civil justice system – without limiting access to the courts for legitimate claims

In this segment, Dr. Robert Hartwig explains why legal system abuse is a key but underreported driver of the cost of living, how legal system abuse directly affects household budgets, and what reforms can help ease cost-of-living pressures for Americans.

MORE ABOUT ROBERT P. HARTWIG:
Robert P. Hartwig is Clinical Associate Professor of Risk Management, Insurance and Finance in the Darla Moore School of Business at the University of South Carolina and Director of the school's Center for Risk and Uncertainty Management. He teaches courses in risk management, insurance and corporate finance, mentors students, pursues a variety of research interests and works with insurers, regulators, legislators and many other insurance industry stakeholders, including media. Dr. Hartwig is also a past member of the Federal Reserve Board's Insurance Policy Advisory Committee. Dr. Hartwig serves as a media spokesperson for the property/casualty insurance industry and is quoted frequently in leading publications such as The Wall Street Journal, The New York Times, USA Today, Washington Post, Los Angeles Times, Financial Times, BusinessWeek, Newsweek, U.S. News & World Report, CFO, Fortune, Forbes, The Economist and many others throughout the world. Dr. Hartwig also appears regularly on television, including programs on ABC, CBS, NBC, CNN, CNBC, Fox, PBS, Univision and the BBC.

Produced for: American Property Casualty Insurance Association (APCIA)

SOURCE American Property Casualty Insurance Association