Legal System Abuse and
Social Inflation
Zurich North America is committed to educating customers and brokers on legal system abuse and the reform efforts needed to reduce the growing financial impacts on the economy, businesses of all sizes and everyday consumers.
We play an active role in a multi-industry coalition spearheading education and advocacy efforts designed to create a fair and balanced legal system.
Key Statistics
Social inflation refers to the rise in insurance claims and litigation costs that go beyond general economic inflation. These rising costs are driven by ever-increasing awards to plaintiffs in tort litigation; and occur when one party seeks remedies for harms caused by another party’s harmful act whether intentional or unintentional. The extremely high awards are fueled by legal system abuse tactics.
Massive jury awards of $10 million or more, known as nuclear verdicts, continue to increase in size and frequency. U.S. Chamber of Commerce, Institute for Legal Reform
U.S. liability claims costs for businesses have increased to an average of 16% annually in the past 5 years, greatly outpacing rates of economic inflation. SwissRe Institute
The U.S. Chamber of Commerce, Institute for Legal Reform estimated that in 2022, the tort system cost the U.S. economy $529 billion, representing 2.3% of GDP.
Each American household is estimated to spend an additional $4,200 annually for goods and services. U.S. Chamber of Commerce, Institute for Legal Reform
Zurich North America’s Future of Risk podcast social inflation mini-series
Dive into our curated collection of podcasts that explore the complexities and ramifications of legal system abuse and social inflation. Each episode features expert insights, real-life stories and actionable advice, offering listeners a deeper understanding of this critical issue.
