Interview | Litigation Without Borders: Reshaping Global Tort Costs
The Global Insurance Forum returns to London Nov. 15–16, bringing together senior insurance executives on the trading floor at Lloyd’s. This year’s theme —Turning Volatility into Value — will examine the forces reshaping the global insurance landscape.
One of those forces is the rapidly changing litigation environment. New international research finds tort costs rising faster than GDP and inflation in several major markets, with implications for claims severity, reserving, pricing and long-term strategy.
I'm Josh Landau, President of the International Insurance Society. Joining me today is Michel Léonard, Ph.D., CBE, Chief Economist and Data Scientist at the Insurance Information Institute, professor and adjunct faculty in NYU’s Department of Economics, and lead author of the research.
Today’s conversation offers a preview of that session and a closer look at what the data tells us about rising tort costs, class actions and litigation funding across major global markets — and what insurance executives should be watching.
Michel, let’s start with the big picture. Give us a brief overview of the research and why rising tort costs should be on insurance executives’ radar.
Michel Léonard
This research compares tort costs across the U.S., UK, EU, Canada, and Australia and finds a consistent pattern: costs are rising faster than GDP and inflation in three of five markets studied. For insurance executives, this isn't an abstract legal trend — tort costs are a direct input into loss costs, reserving, and pricing. When litigation costs grow faster than the economy underwriting it, that gap eventually shows up in claims severity, reserve adequacy, and ultimately premium. The findings matter globally because the pattern isn't confined to one jurisdiction — it's moving.
Josh Landau
What did the research reveal, and what surprised you most?
Michel Léonard
At a high level: the U.S. still carries the highest tort-cost burden as a share of GDP, but it's no longer an outlier by structure — just by timing. The UK is now the fastest-growing tort environment in the study, growing over 15% a year, and on current trend it's projected to overtake the U.S. by 2031. What was most striking is how mechanical the convergence is — it isn't driven by one large verdict or a bad year, it's a steady, decade-long climb in both markets, on trajectories that cross.
Josh Landau
What's driving the growth, particularly with more collective and mass litigation?
Michel Léonard
Expanded private rights of action, particularly class actions, create incentives for litigation funders to back claims, driving tort costs higher. That's the mechanism across every market in the study. In the UK specifically, the 2015 Consumer Rights Act's shift to opt-out collective actions and permissive certification thresholds, combined with a litigation funding market sized at up to £4.5 billion, produced more than 655 million class members in UK competition class actions by the end of 2024 — roughly 10 class actions for every British citizen. The EU is earlier in the same arc under its 2020 Representative Actions Directive.
Josh Landau
Where does this fit into GIF's volatility/strategic-value theme?
Michel Léonard
Litigation cost growth is a form of volatility insurers have less control over than most — it isn't weather, it isn't rates, it's regulatory and legal-system design. But that's also what makes it strategically actionable: unlike catastrophe risk, this volatility responds directly to policy choices. For insurers and businesses, that means litigation trend needs to sit alongside catastrophe and macro risk in reserving and strategic planning — not as a footnote, but as a comparably sized, trackable input.
Josh Landau
Are there lessons for how different legal systems have approached this? What should executives watch?
Michel Léonard
The clearest lesson in the data: regulatory intervention works. Australia and Canada are the two markets in the study where tort-cost growth was contained or reversed, both following direct government action on litigation funding oversight and class-action certification standards — Canada is the only market with declining tort costs over the study period. That's a usable counter-example against the idea that rising litigation costs are simply an unavoidable cost of doing business. Executives should watch two things going forward: where their own market sits on the UK's trajectory, and whether their regulators are moving toward the Australia/Canada model or letting the funding market expand unchecked.
Josh Landau
What are your key takeaways, and what should attendees expect in the discussion?
Michel Léonard
The one takeaway: this is a global, not a national, trend — and it's still early enough in most markets that the direction is not yet locked in. What attendees can expect to explore together is where their own market sits on that curve right now, and what the reform evidence from Australia and Canada suggests is actually available to change.
Josh Landau
Michel, thank you for sharing your insights and giving us a preview of what you’ll explore at the Global Insurance Forum. I look forward to continuing the conversation with you this November.
Join Michel and other insurance leaders Nov. 15–16 for GIF 2026. Register today, and we’ll see you in London.
Information about the Report
International Tort Costs: A Comparative Analysis of the United States, United Kingdom, EUG5, Australia, and Canada
Authors: Michel Léonard, Ph.D., Robert Dunsky, Ph.D., Wenzhen Lin, Ph.D., Mary Sams, and Marina Madsen
U. S. Chamber of Commerce Institute for Legal Reform, July 2026," published at 1615 H Street NW, Washington, DC 20062
U.S. Chamber Press Release