In the rapidly shifting landscape of property/casualty insurance claims, negotiation stands at the pivotal moment for improved settlement outcomes, client satisfaction, and bottom-line carrier health. In 98-99 of every 100 litigated files, the carrier’s financial outcome will be established through negotiation.
Executive Summary
“More frequently than not, claim professionals have the purse strings but counsel does the talking.”
That’s how Suite 200 Solutions Founder Taylor Smith summarizes a recent survey finding that defense counsel now convey settlement offers more frequently than carrier claim professionals.
Here, Smith reviews several highlights of the survey of senior claim and litigation executives conducted by Suite 200 Solutions, an advisory firm for P/C claims and litigation management professionals. He also advances the view that claim professionals should reclaim negotiation as a core competency and offers a how-to guide for carriers to follow to strengthen underused negotiation muscles.
Our insurance industry operates the largest negotiation network in the world. In the litigation arena alone, we estimate that 30,000 claim professionals assign approximately a million files a year to another 30,000 defense attorneys, approximately 98-99 percent of which will be resolved through negotiation. Add to this the ever-increasing number of non-litigated but attorney-represented claims, and the importance of effective negotiation is glaringly obvious.
Yet, as revealed in the latest Suite 200 Solutions Industry Snapshot “Claims Negotiation in the Age of AI-Enabled Plaintiff Advocacy,” the industry is facing a subtle but critical drift: Negotiation responsibilities, once the stronghold of claim professionals, are now often being handled by outside counsel rather than by those closest to the file and its unique challenges.
This article unpacks the findings of the Snapshot report in two core areas: who’s doing the negotiating, and how is the negotiating being conducted. We explore why the insurance sector must reclaim negotiation as a core competency and offer a road map toward strengthening negotiation acumen for competitive advantage.
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