Trends Show A New World Of Insurance Litigation

Coverage litigation trends in U.S. federal courts since 2022 reflect a markedly different landscape from both the early COVID-19 years and the decade preceding them. According to a report from Lex Machina, the LexisNexis Legal Analytics platform, homeowners’ policy claims unrelated to hurricanes and commercial liability coverage disputes have reached record highs. Meanwhile, litigation involving business interruption insurance remains prevalent, even years after the widespread business closures in the early days of the pandemic.

Homeowners policy coverage disputes surging independent of hurricanes

Excluding cases related to hurricanes, homeowners’ insurance cases have increased sharply each year since 2018. In 2024, more than 3,500 such lawsuits were launched in federal district courts - the highest total since at least 2009. Although these cases do not explicitly cite hurricanes, more than half refer to losses associated with weather events such as storms, high winds and floods. Data from Lex Machina for January through September 2025 indicates another year-to-year increase.

• Homeowners Policy Insurance Cases Filed in U.S. Federal District Courts Excluding Hurricane-Related Cases, 2015 to 2024. Source: Lex Machina 2025 Insurance Litigation Report

Rising business liability coverage disputes

Lawsuits concerning businesses' liability coverage have jumped each of the past three years, following a long period of stability. More than 3,000 such lawsuits were initiated in federal courts in 2024, more than in any year since 2010, and data through September 2025 shows continued growth for this year.

• Business Liability Insurance Cases Filed in U.S. District Courts, 2015 to 2024. Source: Lex Machina 2025 Insurance Litigation Report.

During a recent webcast discussing findings from the report, industry observers attributed the growth in business liability cases to several factors, including rising social costs, carriers’ shifting postures towards coverage decisions and new technologies creating unprecedented risk scenarios. “Insurers are taking more assertive stances on denials,” said Daniel Cotter, member of Aronberg Goldgehn Davis & Garmisa in Chicago.

Karen Yotis, the Lexis Practical Guidance Content Manager and Editor for Insurance Law, added that insurers are also confronting “emerging fact patterns that have little precedent,” such as cybersecurity risks; environmental, social and governance-related liabilities, and insureds’ use of artificial intelligence. “These breed litigation,” she said. “There’s not a whole lot of precedent on those fact patterns, and it seems to be causing more filings.”

Continuing presence of business-interruption claims

Lawsuits seeking coverage under business-interruption policies continue to surface in federal courts even as pandemic-related claims have passed their limitations periods. In 2024, more than 650 business-interruption coverage lawsuits were launched in federal courts, a figure more than 50% higher than any year in the decade preceding the pandemic. Data from Lex Machina for January through September 2025 indicates that business-interruption claims have trended upward again this year. Of note, most business-interruption coverage lawsuits filed between January 2024 and September 2025 have losses resulting from climate phenomena, including hail, winds, storms, hurricanes and floods.

“The focus has shifted from COVID-19 business interruption disputes to a climate-driven business interruption insurance situation, which comes from the hail, the storms and the floods of recent years,” said Yotis.

“Post-pandemic, business-interruption litigation really focuses on climate events,” agreed Cotter. For example, “there are a lot of cases in California where the wildfires have caused significant business interruption,” he said.

Charting forward

Beyond well-reported catalysts such as pandemics and hurricanes, insurance coverage litigators are also contending with subtler forces including rising social costs, evolving technologies and climate-related risks. Understanding the dynamics behind today’s coverage disputes on homeowners, commercial liability and business-interruption insurance policies allows legal and insurance professionals to make data-driven strategy recommendations in this new era of insurance litigation.

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