Overall, total revenue for the personal injury lawyers industry is $34.5 billion and profit is $6.5 billion as of 2015. The industry is mature and has a moderate and stable growth. Revenue has an annual increase of 2.3% for the past five years and is expected to increase 1.8% annually for the next five years.
Automobile accidents are the leading cause of personal injury litigation, representing 58.7% of the market. Airline and marine personal injury, medical malpractice, and other personal injury cases account for the rest of the market, approximately 42%.
The baby boomer generation continues to reach their retirement age. Over the next five years, the number of people over the age of 65 is forecasted to reach 56 million by 2021 at an annual increase of 3.2%. This trend in the population will cause industry demand to grow in two ways. First, due to the higher likelihood of people aged 65 and older to be involved in a car accident. 56% of tort cases are due to car related accidents and personal injury. Second, there will be an increased in physician visits. Physician visits are expected to rise at an annualized rate of 3.3% to 1.2 billion, which directly impacts the demand for medical malpractice claims. Consequently, as the number of physician visits rises, industry revenue is expected to grow. In addition, medical malpractice coverage costs are expected to experience modest increases in the short term, driven upward in reaction to the ongoing consolidation of hospital physicians’ offices and other providers in the U.S., due in large part to dramatic changes to health care delivery and reimbursement models.
Overall US economic growth in 2015 was +2.4%. As such, the ratio of tort settlements to gross domestic product (GDP) rose in 2015. Since 1950, growth in tort costs has exceeded growth in GDP by an average of approximately two percentage points. There is a strong correlation between the size of tort settlements and U.S GDP.