The Insurance Information Institute (Triple-I) released an issues brief showing that plaintiff attorney tactics, including aggressive billboard advertising, contribute to higher auto insurance premiums in Colorado and other states by fueling litigation and increasing claims costs.
The topic is significant as rising auto insurance premiums affect consumers across Colorado and the nation. The Triple-I’s issues brief, Legal System Abuse – State of the Risk, details how plaintiff attorney practices raise claims costs for insurers nationwide. The brief states that insurers paid out over $1.10 for every $1 in premiums collected last year due to heightened litigation driven by these tactics. Aggressive attorney marketing, including billboard advertising, is identified as a key factor contributing to higher auto insurance rates, according to the Insurance Information Institute’s issues brief Legal System Abuse – State of the Risk.
Data from the Rocky Mountain Insurance Association show Colorado auto premiums have risen 53% over the past decade, with legal system abuse cited as a contributing factor. Between 2018 and 2022, average bodily injury claim severity increased 40%, driven in part by lack of transparency in medical damages that can lead to higher settlements. Firms such as Franklin D. Azar & Associates, Anderson Hemmat, Bachus & Schanker, and McDivitt Law Firm, known for billboard advertising, are linked to rising claims costs passed on to consumers according to data from the Rocky Mountain Insurance Association.
A joint analysis by the Casualty Actuarial Society and Triple-I found that legal system abuse added $91.6 billion to $102.3 billion in personal auto liability losses from 2015 to 2024, representing 8.7% to 9.7% of booked losses. Nationwide, excess value from motor vehicle tort cases totaled $42.8 billion over the decade, illustrating how litigation practices drive insurance premium increases across the U.S., according to a joint analysis by the Casualty Actuarial Society and Triple-I.
The Insurance Information Institute is a nonprofit organization founded in 1960 that provides research and insights on insurance topics to inform consumers and stakeholders. It collaborates with over 50 member companies to produce data-driven reports on risks and trends. The institute maintains independence in its analyses to support public understanding of insurance. The organization supports stakeholders including consumers, media and policymakers by providing resources in English and Spanish.
