The median size of the top 50 US bodily injury verdicts soared from $49.7mn in 2019 to $98.2mn last year, data from law firm Kahana & Feld shows.
The yearly average recovered to pre-pandemic levels in 2022 at $48.7mn and since then showed a much steeper increase compared to the 2014-2019 trendline.
When Kahana & Feld first started compiling the data 10 years ago, the number of bodily injury awards over $500mn could be counted on one hand over 2014 and 2015, according to Sofya Uvaydov, vice chair of Kahana & Feld’s national appellate litigation and consulting group.
“Those were aberrations. [In 2024], we have six verdicts that were over $500mn,” she added.
The trend shows a similar trajectory as medical malpractice verdict awards, which dipped during Covid-19 years and rebounded with a vengeance, doubling in 2024 from 2019 levels.
Importantly, large jury verdicts often get downsized in the post-trial process or settlements.
Nonetheless, the upward trajectory of jury awards underscores an uncertain risk environment for the P&C industry which has been putting up adverse development in other liability at “a materially accelerated pace versus historical trends”, according to the Insurance Insider US Research team.
The severity spike may not be temporary
In an interview with this publication, Uvaydov said that the “very rapid growth” of jury awards in 2023 and 2024 could be driven by the bottleneck effect from the Covid-19 years.
During the pandemic, “a lot of the less serious cases were resolved, and what we have [now] are the worst cases that stayed on everybody’s books,” she added.
On that note, the current severity spike could be temporary, a hangover from the Covid-19 pandemic, rather than a full representation of underlying loss trend.
But it is unclear when this Covid-19 effect will come to an end, the Insurance Insider US Research team stated.
Latest US court data shows that the number of pending civil cases remained elevated as of March 2024, whereas the number of terminated cases didn't show a commensurate uptick that would suggest an easing of the backlog.
Whatever the driver is, Uvaydov pointed out that a “sustainable period of very high verdicts” can nonetheless feed into increasing verdicts or settlements to come in the future.
“When your highest goes up, your less serious verdicts also now have been decompressed and they can go up marginally,” she added.
For example, the average person might not have a $100mn case, but when that $50mn case becomes a $100mn verdict, what used to be a $5mn case can now reasonably be sustained at $8mn-$10mn.
And the courts, which review the jury’s decision by comparing other verdicts or the “shock the conscience” standard, now have a much wider range of numbers they’re looking at, Uvaydov added.
“Now that these huge numbers are on the books, it’s not just going to impact what plaintiffs take in settlements and what they expect in verdicts, but on a purely legal side, when you’re trying to get post-trial relief,” she said.
Kahana & Feld sources data from ALM, LexisNexis, and Westlaw which collect information from media reports or self-reporting from plaintiffs’ attorneys.
The law firm’s report aims to capture the trend of jury awards and jury sentiment in bodily injury cases. It does not count class action lawsuits which operate differently in assessing individual exposure, or verdicts rendered against tobacco and asbestos, which often regard cases that are decades old.
In the 2024 top-50 list, New York, Pennsylvania, Illinois and Texas accounted for five cases each, with Pennsylvania’s average award size of $633mn outsizing the other three, whose averages were all between $100mn and $160mn.
Texas, in particular, is seeing a very significant load in trucking-related litigations, Uvaydov said, despite not being on the top 10 judicial hellhole list compiled by lobby group American Tort Reform Foundation.
Nevada, which had four cases on the list, ranked number one in terms of the award size. Its average was a staggering $2.3bn and the total award granted in the state was nearly $9bn, accounting for nearly half of the aggregate value of the top 50 cases.
Clark County, Nevada, produced the first and second largest verdicts. Both were product liability cases related to a bottled water company whose products were accused of causing liver damage. The jury granted $5.2bn and $2.3bn, respectively. In both cases the majority of the awards were for punitive damages.
Among other states regarded as challenging markets for insurers, California had three cases on the top 50 list, averaging $63mn. Florida, which passed tort reforms in late 2022, had two cases averaging $123mn.
By case type, product liability led the top 50 pack, with 18 cases, followed by motor vehicle with 12, and medmal with seven. Traditionally, these three have always been at the top of the list, according to Uvaydov.
But a new case type that has surfaced in recent years is school negligence, she said, especially in New York which extended the statute of limitations for child victims in 2019.
One New York case that made last year’s list involved a 16-year-old plaintiff that was sexually abused by a teacher. The jury awarded $160mn.
No ceiling for pain and suffering
Half of the top 50 verdicts included punitive awards, which varied from 2% to 95% of the total verdict in size. However, many states do not permit punitive damages to be covered by insurance, according to Uvaydov, and such damages “are almost certainly reduced” in post-trial motions.
According to WTW, punitive damages are not insurable in 13 states including Florida, California, New York, and Illinois, but are covered in others.
But setting aside punitive damages, Uvaydov said there has been a rise in compensatory damage as well, driven by increase in both medical expenses and pain and suffering.
And while medical expenses need to be tied to a certain treatment or certain documentation, there are no instructions or mathematical equations for the jury deciding what fair compensation is for pain and suffering, she added.
“And what we’re seeing is the juries making that number higher and higher,” Uvaydov said.
There is also a state-by-state aspect where some jurisdictions like Texas or Pennsylvania ask juries to break down non-economic damages into multiple categories like physical pain, mental anguish, and the loss of enjoyment of life, whereas in places like New York pain and suffering is a single-line item.
“The more lines you have on that verdict sheet for pain and suffering, the more likely it is to be bigger,” added the attorney.
While the jury may not be comfortable putting up a chunk of $100mn in pain and suffering, they can be more amenable to put down smaller itemized awards which still add up to a substantial sum.
“That’s the danger of jurisdictions that break down pain and suffering into different types of categories.”
In addition, another change in the courthouse Uvaydov pointed out was the inflation of numbers that juries hear in the media as a pain and suffering anchor.
“You’re no longer comparing what does an average person make in a year – you’re now looking at what does Jeff Bezos make in a year,” she said.
“I have seen that used by plaintiffs [attorneys] in summation, quite literally calling on a multibillionaire in a lawsuit against a small business owner.”