This article reports and explains four key findings about the difference between the role of insurance in mass tort litigation and the role of insurance in ordinary tort and corporate governance litigation as reported in earlier research: (1) outside of the insolvency context, mass tort plaintiff lawyers do not build their litigation and settlement strategy around defendants’ liability insurance; (2) mass tort defendants typically retain control over their defense, even when they recover under insurance policies that assign the insurer control over their defense; (3) mass tort defendants typically use their own funds to settle claims, obtaining indemnification from their liability insurers, if any, later; and (4) many mass tort plaintiff law firms rely on non-recourse litigation funding that resembles the earliest forms of commercial insurance – bottomry and respondentia – and there is an emerging insurance market that reduces the cost of this funding and may one day supplant it. In addition to providing a new understanding of the role of insurance in mass tort litigation, this research provides empirical support for two of the conceptual insights in Kenneth Abraham’s Liability Century: (1) the mismatch between product liability and product liability insurance that emerged near the end of the 20th Century, and (2) the increasingly insurance-like function of tort law.
Insurance markets, risk assessment & management, mass torts, complex litigation, class actions, liability, legal & settlement strategies, non-recourse financing, bottomry contracts, respondentia
Texas Law Review
Baker, Tom, "Where's the Insurance in Mass Torts?" (2023). Articles. 238.