Florida Lawmakers Ready for Another Shot at Litigation Funding Limits

Florida property-casualty insurance leaders have said they are not expecting big changes from the Legislature’s 2026 regular session that begins today, given the much-touted impact that 2022 reforms have already had on excessive litigation costs in recent years.

But one bill that supporters said would further rein in litigation expenses and losses has been given a chance of passing—fueled by growing concerns that third-party investments in lawsuits prolong litigation and promote unwarranted class-actions.

House Bill 1157, sponsored by state Rep. Fabian Basabe, R-Miami Beach, is similar to a measures that failed to pass in 2024 and 2025. It and its companion, Senate Bill 1396, by Sen. Colleen Burton, aim to place limits on the scope of influence that third-party litigation financiers can have on litigation. They have the support of the U.S. Chamber of Commerce.

“These bills will shut down a dangerous loophole that allows hostile foreign entities to bankroll litigation designed to undermine Florida’s economy and harm its citizens, a critical step toward reclaiming the state’s legal system from foreign manipulation,” reads a post from the U.S. Chamber’s Institute for Legal Reform.

The measures would bar funders from directing the course of any civil action, including picking the lawyers involved, expert witnesses, and strategy. The bills also would block financiers from receiving a larger share of awards or settlements than the plaintiffs receive.

Further, the bills would:

• Bar funders from paying commissions or fees to anyone who refers someone to the litigation financier.
• Require that all agreements with foreign interests or persons be disclosed within 14 days of signing the agreements, and clearly identify the people involved. The financing terms would not need to be disclosed, and a court may allow the agreements to be filed under seal.
• Allow court fines and other sanctions against parties that do not comply.

If approved and signed by the governor, the law would take effect July 1, 2026.

Passage in the Florida Senate appears likely. But the House, where sentiments for less—not more—tort reform run hotter, may be less inclined toward approval, said George Feijoo, a lobbyist and consultant representing the U.S. Chamber.

If litigation funding restrictions do make it to the finish line, Florida would become at least the ninth state to clamp some type of limits on third-party lawsuit financiers.

Georgia, Kansas, Louisiana, Indiana, Montana, Oklahoma, Wisconsin, West Virginia and New York now have laws regulating third-party litigation funding, according to news reports. Washington State is considering a bill this year. And sources have told Insurance Journal that some Alabama lawmakers and insurance interests in recent weeks have been huddling for a push in the session that begins today, Jan. 13.

The full text of Florida’s HB 1157 can be seen here.

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