Excessive Litigation Is Driving New York’s Affordability Crisis
New York is the most expensive city in America. A major contributing factor to the city’s affordability crisis is the prevalence and high cost of litigation. The most direct consequence of excessive litigation is that New Yorkers pay insurance premiums that average 15% higher than the rest of the country, ranging from 12% higher premiums for health insurance to 52% higher premiums for auto coverage.1 The cost and availability of insurance is cited as the second biggest cost-related concern after labor costs in a recent survey of bar and restaurant owners conducted by the New York City Hospitality Alliance.
New York laws encourage outsized jury awards and settlements, exorbitant attorney fees, staged accidents, and fraud. New York has the second-highest cost of litigation and claims paid (“tort costsˮ) in the nation — over $7,000 per household, 67% above the national average ($4,200). 2 Only Delaware has higher tort costs per household ($8,000). Residential rents and prices for consumer goods and services would all be more affordable if New York brought its litigation costs in line with other states…