Emerging Factors Forecast a Continued Rise in Insurance Litigation

Nearly three years have passed since the COVID-19 pandemic shocked global economies. From supply chain interruptions and shortages to an overwhelming shift to remote work, the pandemic’s effects on individuals and businesses alike have been nothing short of substantial.

Nowhere else were these effects clearer than with insurance-related litigation, causing crammed court dockets, trial delays, and an increased volume of cases referred to mediation because of the ability to attend remotely.

With fears of an economic recession ahead, coupled with the overall increase in litigation since the start of the pandemic, claims professionals should not expect the rate at which their claims are litigated to decrease. Moreover, they should be prepared for the eventual impacts of inflation.

McKinsey & Company has estimated that inflation alone increased property and casualty insurer loss costs by $30 billion in 2021, with ~75% attributed to personal lines.

As the pandemic forced many to work remotely, it also forced the legal industry to adapt to ‘remote litigation,’ allowing for hearings, depositions, mediations, and even trials to be conducted via telephone/videoconferencing. The resulting time saved in not having to travel to attend such proceedings has arguably allowed for higher volumes of litigation to be maintained. Adopting these adaptations long-term could help accommodate the expected rise in litigation.