The Louisiana Department of Insurance is joining forces with the National Insurance Crime Bureau (NICB) and a digital intelligence firm to warn consumers about bad actors who spend hundreds of millions of dollars annually to generate unnecessary legal claims.
The department said earlier this month that it is partnering with the nonprofit NICB and 4WARN in an effort to shield Louisiana consumers from digital tactics employed by opportunists working on behalf of the third-party litigation funding (TPLF) industry.
TPLF refers to the practice of outside financing entities paying the costs to advance civil lawsuits in return for obtaining a percentage of the settlements or damages judgments in such cases.
Louisiana Insurance Commissioner Tim Temple called lawsuit growth a major factor in rising insurance costs for consumers.
“The LDI is dedicated to protecting Louisianans from opportunists who manipulate the claims process to fuel excessive litigation, which is a primary driver of our high insurance costs,” Temple said in a prepared statement. “I’m excited to partner with NICB and 4WARN to expose these misleading practices that prey on policyholders when they are most vulnerable.”
The effort to thwart online practices that steer consumers into costly legal actions prior consulting with their insurance companies comes amid rising concerns about the TPLF industry’s impact in Louisiana. One lawmaker, Rep. Emily Chenevert (R-Baton Rouge) has authored legislation, House Bill 240, that attempts to rein in TPLF excesses and provide more transparency to the activities of litigation funders.
“Louisiana has made some progress on third-party litigation funding in recent years, but we have more work to do,” Temple said in a statement emailed to the Louisiana Record. “My staff and I are reviewing legislation filed so far, and I look forward to working with Rep. Chenevert and other legislators to address that issue this session.”
NICB and 4WARN said in a recent report that misleading TPLF-related websites elicited 27.8 million clicks in June of last year alone and that about $380 million was spent on online search ads between June 2024 and June 2025.
“Additional research shows that verdicts exceeding $10 million have nearly tripled nationwide since 2020,” Temple’s department reported. “TPLF drives up insurance premiums by fueling larger settlements that increase insurer losses and creates the potential for more lawsuits.”
The practice of TPLF has now gone beyond simply funding lawsuits, according to the report by NICB and 4WARN.
“Funders today are not only backing lawsuits, they’re fueling an entire digital ecosystem of law firms, marketing networks and technology platforms designed to escalate litigation,” the report’s executive summary states. “Law firms provide essential advocacy, helping claimants navigate the often complex process of filing and resolving insurance claims. … At the same time, a small but harmful subset exploit the system through fraudulent claims, deceptive practices and digital manipulation such as impersonating brands or shaping online narratives.”
Opportunists are now spending hundreds of millions of dollars yearly to manipulate litigation outcomes through online tactics, according to the report. The study identified nearly 3,200 opportunists that are taking part in activities against insurers, including the tracking of consumers’ online searches in order to reel in claimants before they know what they’re getting involved in.
Such online techniques include coordination of fraud rings “involving multiple actors, from law firms and funders to medical providers, adjusters and contractors, working together to inflate claims and extend litigation,” the study found.
LDI encourages consumers seeking to resolve claims to first contact their insurers, to seek out information from only trusted sources, such as the LDI website, and to use only legitimate web browsers with protections against malicious websites.
