Ohio House Bill 105 took effect October 6, 2026, three months after Governor Mike DeWine signed it on July 7. The law requires third-party litigation funders to register with the Ohio attorney general before doing any business in the state, bars funders not domiciled in the United States from financing Ohio lawsuits, and prohibits funders from directing litigation strategy or settlement decisions. What it does not do is give a claims adjuster any new information about the file open on their desk. Funding contracts are disclosed to the attorney general only after the related claim resolves, and only then are they published on the attorney general’s public website.
That timing choice is the whole story for reserving. Ohio now knows who its funders are, but the party defending the lawsuit still cannot see, mid-case, whether the plaintiff’s refusal to settle at a reasonable number is being held in place by an outside investor’s return hurdle.
What the law actually does
The bill splits the market into two buckets. Consumer legal funding agreements, defined as agreements with natural persons residing or domiciled in Ohio involving cash payments under $400,000, carry detailed contract requirements: an explanation of how charges accrue, a statement that the consumer owes nothing if there are no proceeds, a 10-business-day cancellation right, and a cap on one-time fees at 7% of the initial funded amount. Funding companies cannot pay referral fees to attorneys, law firms, medical providers, chiropractors, or physical therapists, and cannot accept commissions from them either.
Commercial litigation financing agreements, the bucket that matters for self-insured defendants, get less prescriptive treatment. Financiers must register with the attorney general, cannot exercise control over litigation decisions, cannot take foreign money, and attorneys involved in commercial agreements cannot share documents subject to protective or sealing orders with the financier. But the bill is, in the Legislative Service Commission’s own analysis, mostly silent on the form and content of commercial agreements, and the mandatory disclosure to the attorney general arrives only upon resolution of the claim.
Who it affects
Self-insured trucking fleets running Ohio lanes, where I-70 and I-75 concentrate interstate freight traffic through Columbus, Dayton, and Toledo. Self-insured employers and public entities carrying general liability above their retentions in Ohio venues. Single-parent and group captives writing commercial auto and GL net of fronting arrangements. The Owner-Operator Independent Drivers Association has flagged litigation funding as a driver of excessive nuclear-style verdicts in trucking specifically, which is why the trucking press tracked this bill closely.
The reserve mechanism: development, not frequency
Litigation funding does not create claims. What it does is change how long open claims stay open and how high they settle. The canonical example is Burford Capital, the publicly traded litigation finance firm, which was able to block Sysco Food Service from settling antitrust cases for less than Burford had invested in the litigation. Groups including Lawyers for Civil Justice have published studies finding that funding agreements often include clauses requiring plaintiffs to comply with the funder’s decisions on whether to settle and for how much, despite professional rules in most states prohibiting exactly that.
For a self-insured, that translates into two measurable distortions. First, time-to-resolution stretches: a funded plaintiff with a funder’s return hurdle has less reason to accept an early, actuarially reasonable offer, so claims that would have closed at 18 months close at 36. Second, settlement anchoring inflates: the eventual number lands further above the initial case reserve than the historical pattern predicts. Both show up as adverse development on open bodily injury claims, which is a development-pattern shift, not a frequency change and not an expected-claim-ratio change. Your actuary’s triangle will see it before your loss runs do.
HB 105 does not fix either distortion in real time. Because disclosure happens only post-resolution, the adjuster setting the case reserve on an Ohio BI file in November 2026 has exactly as much visibility into funding as they had in May. What the law may eventually provide is retrospective data: once the attorney general begins publishing resolved funding contracts, self-insureds with Ohio exposure will get the first real look at how much funded litigation was actually in the system, and can back-test whether their Ohio venue claims developed differently from unfunded peers.
The patchwork around it
Ohio is not an outlier; it is the middle of a distribution. North Carolina banned litigation funding agreements outright for new civil proceedings. Colorado’s law, effective August 2025, requires foreign financiers to identify funders and file copies of funding agreements with the attorney general at the time a civil action is filed, or within 35 days for pre-existing agreements, and makes noncompliant agreements void with fines up to $20,000. Georgia, Kansas, and Oklahoma adopted their own funding rules in 2025. Arizona’s SB1215, banning referral-fee payments and foreign-influenced funding, sat on Governor Katie Hobbs’s desk as of late June 2025. California’s AB743 would license commercial litigation financiers through the Department of Financial Protection and Innovation. New York’s A804 would impose registration and disclosure requirements on a currently unregulated market.
For a fleet operating a multi-state SIR program, this is the operative problem we flagged when disclosure bills reached seven states: the same claim, in the same accident year, now carries materially different settlement dynamics depending on which state’s courthouse it lands in. Ohio’s post-resolution-only regime sits closer to the permissive end than North Carolina’s ban, which means Ohio venue claims arguably deserve a heavier development load, not a lighter one, relative to post-ban North Carolina files.
Where this shows up in your reserves
Open your commercial auto development triangle and isolate Ohio-venue bodily injury claims. Compare two ratios against neighboring states: median time from report to closure, and ultimate settlement divided by the case reserve set at 12 months post-report. If funded litigation is active in your Ohio files, the first ratio stretches and the second drifts above 1.0 with increasing consistency by accident year. On the actuarial report, this surfaces in the selected loss development factors for Ohio-valued claims and, if your actuary picks them by state cohort, in the tail factor. If Ohio is currently blended into a national private-passenger-plus-truck cohort, that blending is where the distortion hides. For a refresher on the mechanics, see our commercial auto fleet IBNR explainer.
What this means for your next review
Put Ohio venue claims on the agenda for your next interim reserve review, and ask two questions: whether the Ohio cohort in the triangle shows longer time-to-resolution or settlement-to-initial-case-reserve patterns consistent with funded litigation, and whether the tail factor selection should treat Ohio as a distinct cohort rather than a blend. The honest answer today is that nobody can size the funded share of Ohio litigation yet; the attorney general’s first batch of post-resolution contract disclosures will be the first real data point, and it is worth assigning someone to watch for it.
Decision-maker checklist
- Ask your TPA how it flags suspected funded claims on Ohio files today, and whether that flag feeds into case reserve review or just sits in the adjuster notes.
- Pull time-to-resolution and settlement-to-12-month-case-reserve ratios for Ohio BI claims closed in the past 24 months and benchmark them against Indiana, Pennsylvania, and Michigan files.
- Ask your actuary whether Ohio should be broken out as a distinct cohort in the commercial auto triangle and tail factor selection, given the post-resolution-only disclosure regime.
- For multi-state SIR programs, map your route network against the disclosure regimes: which states require funding disclosure at filing, which disclose only post-resolution, and which ban funding outright.
- Assign someone to monitor the Ohio attorney general’s publication of resolved funding contracts; the first batch will tell you whether funded litigation was a rounding error or a real share of your Ohio claim inventory.
Sources
- Ohio House Bill 105, 136th General Assembly (effective October 6, 2026)
- The Times Leader: New Ohio law has attorney general reviewing litigation-funding contracts (July 21, 2026)
- ABA Journal: Ohio governor signs bill prohibiting foreign litigation funding (July 9, 2026)
- Land Line Media: States adopt third-party litigation-financing reform (June 30, 2025)