The American Property Casualty Insurance Association (APCIA) maintains a recently released report that determined rising commercial automobile litigation negativity impacts Texas businesses and consumers.
The APCIA said that “Trends in Attorney Representation: Texas Commercial Automobile Insurance,” a study executed by the Milliman actuarial firm via the examination of thousands of claims over a five-year period, revealed larger losses in Texas grew at a faster pace than other losses.
During the same period, the analysis also showed attorney representation increased, and the costs of resolving claims were significantly higher for claims with attorney representation.
“Increasing attorney involvement in commercial auto claims is a real concern in Texas,” Lee Ann Alexander, APCIA’s state government relations vice president, said. “Consumers are led to believe through aggressive advertising that they need to sue in order to be compensated for losses. The real winners when this happens are the lawyers. Studies suggest that most claimants do not actually improve their recoveries by involving an attorney, but they do incur higher costs, and it takes much longer to resolve their claims.”
Key study findings include the number of commercial auto liability claims over $500,000 in value grew by 60 percent in Texas from 2015 to 2019; attorney involvement in commercial auto liability claims continues to rise in Texas, increasing over 14 percent compared to 2015; when an attorney is involved in a commercial auto claim in Texas, both the average time to report claims and resolve them are considerably longer than when no attorney is involved; and average commercial auto claim payout, for commercial auto claims with attorney involvement, are increasing faster than the costs for claims without an attorney.