A new consumer guide is showcasing how families and small businesses are feeling the pinch from our country’s costly legal system – with hidden annual costs continuing to climb. In A Consumer Guide: How Legal System Abuse Impacts You, the annual average costs of a slew of litigation tactics are broken down to show the real, wide-ranging impact of our country’s overly litigious legal climate.
According to the guide, the average American family of four pays over $6,000 in hidden costs annually, while small businesses face over $160 billion in annual legal costs. These costs are driven by a number of factors, including: “aggressive attorney advertising, third-party litigation financing, and persuasive jury ‘anchoring’ techniques.” Not surprisingly, our country’s excessive litigation environment has not only raised costs across the board but has also resulted in the loss of 4.8 million U.S. jobs.
Additionally, the guide takes aim at the notion that the bulk of large settlements benefits the plaintiffs in each case. As noted in this Business Wire article, “in many cases, third-party investors and legal fees consume a sizable portion of the award, sometimes more than half. Additionally, the plaintiff may incur other costs such as medical expenses and case fees, which could affect the final settlement they receive.”
The guide was created by the Insurance Information Institute and Munich Reinsurance America, Inc.