Litigation Finance May Help Your Insurance Case

The COVID-19 pandemic has created an economic fallout in its wake. It is estimated that state budget shortfalls stemming from the pandemic’s financial impact will total $615 billion over the 2020, 2021, and 2022 fiscal years. Now, more than ever, insurance-related cases are rapidly rising. Policyholders and insurers alike are contemplating how they will proceed with claims. In their time of need, litigation financing may be the solution that maximizes recoveries in extensive cases.

Benefiting Policyholders

Policyholders wishing to recover claims may benefit from the assistance of litigation finance. In these scenarios, claimants are often denied coverage following a catastrophic event that they believe is within the scope of the policy. While amid a pandemic, financial strains have placed policyholders in a particularly precarious situation. This leaves the claimant ill-equipped to proceed with litigation against the insurer for refusal of coverage. Without additional litigation, policyholders are forced to forego their claims or to settle for mere crumbs. These claimants are not financially equipped to litigate a case to its fullest potential.


Litigation financers want to fund meritorious coverage claims, particularly instances where the policyholder has incurred or paid substantial costs for property damage losses. The additional funding can help the claimant face the stresses of lengthy litigation. If the policyholder chooses, they may choose to negotiate alternative fee arrangements that allow them to mitigate their own risk. Instead of being forced to settle for less or spend a lot on a lengthy litigation process, with the help of top-notch counsel, policyholders may decide to resolve for the appropriate amount.

Aiding Insurers

Subrogation cases have a rep for being lengthy and costly, with no complete assurance of victory. While there is a prospect for recovery, firms still undertake a high level of risk whenever engaging in subrogation. Separately, disputes frequently occur between reinsurers, regarding which party is liable for payment and the amount of compensation. Like subrogation cases, reinsurance battles can be extensive and expensive.


By utilizing third-party funding, both firms pursuing subrogation and insurers can benefit. Firms no longer bear the full weight of the risks of holding contingency fees. As a result, they are able to recognize revenues immediately, while still receiving a share of the future recovery. Additionally, insurance companies can obtain relief from claims they may have passed along, for lack of resources. Insurers can maximize their profits from reinsurance claims.


In the business of sharing risk, litigation finance may be the perfect solution for you. For more information visit Town Center Partners.


Topics: litigation finance, third-party funding, legal funding, insurance, policyholder, insurer, COVID-19, pandemic



TownCenter Partner Team

TownCenter Partners, LLC lead Asset Manager is Mr. Roni A. Elias. From modest beginnings, and with the help of a hand-picked dream team of professionals we have built one of the most dynamic and fastest growing companies in the country. TownCenter Partners LLC(TCP) is a real estate partner and master-planner providing development, leasing, management, and third party services. The company’s demonstrated ability to apply big ideas in creative and innovative ways has played a defining role in the firm’s success. Yet, TCP's most important insight has been the core understanding that it is not sight lines or site plans, but human activity, that defines a space and creates a place.