A report released on May 3 by the public relations firm Marathon Strategies revealed that California ranked third in the United States for the largest total sum of "nuclear verdicts" in 2023, verdicts exceeding $10 million.
According to the report, California witnessed 117 nuclear verdicts last year, amounting to a total of $25.23 billion. The study attributes this high number to California's "liability-friendly laws and courts." A notable nuclear verdict in the state in 2023 was a result of a lawsuit concerning a vehicle accident, which led to a $161 million verdict against Suzuki Motor in Orange County.
The Insurance Journal has reported that nuclear verdicts have had substantial repercussions on the insurance industry. One significant impact is the strain on the availability and affordability of insurance coverage. As jury awards increase, particularly in cases involving trucking, pharmaceuticals, and product liability, insurers are finding it increasingly difficult to underwrite these risks without escalating premiums or reducing coverage limits.
A statewide survey conducted by Morning Consult in February found that 62% of Californians believe that the cost of car insurance is negatively impacting California's economy. According to the poll, 66% agreed with the statement that "California’s insurance markets are in crisis." Additionally, 79% expressed concern over the state's required liability limits enabling personal injury attorneys to "more easily pursue settlements." A majority (69%) also voiced support for policy reforms aimed at lowering insurance costs for all by "limiting personal injury lawyers’ ability to abuse the legal system."
Bankrate's report indicates that in California, drivers pay an average annual cost of $2,633 for full coverage car insurance. This figure is significantly higher than the national average cost of $2,299. Specifically, Los Angeles drivers pay an average of $3,600 annually for car insurance.
Marathon Strategies is an independent research and communications firm as per its company website. Founded by Phil Singer in 2008, Marathon's team comprises data analysts, researchers, and attorneys. Singer established the firm, after more than two decades of experience in corporate and political communications.