APCIA Backs Federal Bill to Require Litigation Funding Disclosure

The American Property Casualty Insurance Association (APCIA) has released a statement in support of federal legislation, up for committee discussion today, that is meant to increase the transparency of third-party financers in litigation.

The Protecting Third Party Litigation Funding From Abuse Act, introduced by Rep. Darrell Issa, R-Calif., will be up for a full markup by the House Judiciary Committee on Jan. 13. A committee markup is to determine whether a bill or draft bill should be recommended to the full House of Representatives.

APCIA’s Sam Whitfield, senior vice president of federal government relations and political engagement, said the legislation is a “positive step forward.” The bill would increase clarity by requiring all contracts for funding arrangement be submitted to the court. According to the bill’s text, parties in litigation or their counsel must disclose in writing all other parties to a civil action that will receive any payment contingent on the outcome of the case.

“We believe this will facilitate critical litigation transparency to the legal system,” APCIA said. “We will continue working with Representative Issa, the bill’s sponsors, and other stakeholders as the legislation evolves to ensure it delivers disclosure requirements for parties who engage in for profit investing though our courts.”

The insurance industry has routinely pointed to litigation funding—investments in lawsuits in exchange for a percentage of a settlement or judgment—as a big reason for the rapid increase in litigation costs. During APCIA’s annual meeting last year, Gareth Kennedy, principal of insurance and actuarial advisory service for EY, said the firm has found the average cost for a commercial claim has gone up 10% to 11% per year since 2017. He said the research concluded that over the next five years TPLF will cost the insurance industry up to $50 billion in direct and indirect costs.

Legal system abuse, including the use of third-party litigation funding (TPLF), is firmly on APCIA’s agenda for 2026, it said late last year. David A. Sampson, president and CEO of APCIA, has said the industry trade association “will aggressively fight for disclosure in secretive third-party litigation funding.”

APCIA previously threw its support behind Issa’s Litigation Transparency Act of 2025 (HR 1109), introduced in February 2025.

Related: Court Orders Start to Expose ‘Startling’ Data on Litigation Funding Sources

Topics Lawsuits Mergers & Acquisitions