Let me revise the question: Why are lawsuits bad?
Answer (this is simple): Lawsuits are not bad. Insurance companies just want you to think this.
Let’s discuss a bit of history. In 1787, our forefathers adopted a document called The Constitution. In the Constitution, we established our form of government.
Government included 3 separate branches: The Executive, the Legislative and the Judicial.
The court system (and lawsuits) are centered in the Judicial branch of government. Why does this exists?
Our forefathers knew, to live in a peaceful and lawful society, we needed laws, and we needed an organized forum for people to peacefully and lawfully resolve their disputes.
Hence, the Judicial branch of government, and the court system.
What is a “lawsuit”? A lawsuit is simply a request by one citizen for the court’s assistance in resolving a dispute that he/she could not previously resolve on their own.
It is a request for the formal and orderly process for assistance in helping to resolve the dispute.
So, ask again: Why are lawsuits bad? Answer: They are not. Insurance companies just want you to think so.