According to a report from The Perryman Group, an economic research firm, Nevada’s economy loses $203 million annually due to excessive tort costs. The report was released on November 25, 2024.
The report states that Nevada incurs $738 million in annual federal revenue losses, residents face $1,249 in annual losses, and there are $173 million in local government losses due to excessive tort costs. The transportation and warehousing sector alone suffers $2.6 billion in expenditures, $1.7 billion in lost gross product, $1.2 billion in reduced personal income, and 12,600 job losses annually.
According to The American Tort Reform Association (ATRA), the rise of third-party litigation funding (TPLF) has raised concerns about its impact on the legal system. ATRA says TPLF can lead to increased litigation costs and potential conflicts of interest as funders influence legal strategies to maximize their returns. ATRA noted that TPLF raises ethical issues, such as threats to a lawyer’s ability to exercise independent judgment.
As reported by the Insurance Information Institute (III), TPLF has impacted the auto industry by contributing to increased insurance costs. The III said that excessive litigation, fueled by TPLF, has led to higher auto insurance premiums. In 2023, insurers paid out more than $1.10 for every $1 in premium collected, indicating a loss exacerbated by litigation-related expenses.
The Perryman Group is based in Waco, Texas and is an economic research firm with over 40 years of experience. It serves Fortune 100 companies and U.S. Cabinet Departments and has completed over 1,000 public policy studies on critical economic and social issues.
