Insurance News Sat, Sep 13, 2024
Sub-prime litigation in the US hits record highs
As the credit crunch continues to take hold in all areas of the world there has been a worrying report from the US which suggests that litigation in relation to the credit crunch has topped the figure from the Savings and Loan fallout of the 1990s. Many had expected the Savings and Loan scandal to retain the record for litigation for some time but this has quickly been over taken by the current crisis.
While a number of these cases have been refused and thrown out of the courts a great many have passed first base and are looking to move in for the kill. This situation has the potential to cost the insurance industry millions of dollars (if not billions of dollars) as home owners who were given ‘bad deals’ look for some form of financial compensation.
The problem with the current situation in the US is the fact that due to the numbers, it will quite literally drag on for years, leaving many financial companies and insurance companies with potentially large liabilities hanging over their heads for some time to come. Will we see a wave of court cases in the UK when the full extent of the credit crunch is revealed?
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