Nuclear Verdicts – A Case for the Insights That Technology Can Provide
Nuclear verdicts are a hot topic of discussion across our industry. This is no longer some other claims organization’s problem or an issue only arising in transportation-related claims. Claims leaders are acknowledging the risk these verdicts pose to their business and looking for solid and actionable mitigation tactics.
This is an issue of such relevance, in fact, an industry professional association, the Claims and Litigation Management Alliance (CLM), has announced the establishment of a Nuclear Verdict Task Force, with the goal of helping to provide strategies and solutions meant to anticipate and stop, where possible, nuclear verdicts. In the task force announcement, Anne Blume, CLM’s CEO, said, “Education and communication are critical for raising the bar of the defense industry.”
I couldn’t agree more. Education is critical. And, in addition to education, I also believe that the use of technology and of better structured collaboration with defense counsel will enable claims leaders and claim management professionals alike to intervene more effectively to prevent these nuclear verdicts.
In many of the recent nuclear verdict cases we have analyzed, a few commonalities have surfaced that could have, in retrospect, helped insurers intervene prior to the resulting verdict. While there is certainly no silver bullet fix for nuclear verdicts on the whole, we see clearly that an earlier understanding of the details about many cases might have provided the respective claims organization with enough time to ensure a more positive outcome.
Here are a few areas in which we believe modern technologies, and the claims litigation insights they can provide, could help prevent cases from reaching nuclear status.
Defense Attorney Selection
Many organizations we speak with have relatively little insight into the attorneys assigned to their litigated claims. For the most part, these attorneys are trusted business partners, and claims leaders have a sense for what the attorney may charge on a typical case. They may know average invoice adjustment rates and maybe even the time spent on different kinds of activities.
Yet most claims organizations have little to no critical insight into specific attorney outcomes. They may not know outcomes by type of case or by jurisdiction. They do not know the delta between what an attorney most often predicts versus the ultimate outcome. These are important things to know, and can help claims organizations ensure they’re working with attorneys that give them the best chance at mitigating nuclear verdicts.
Plaintiff Attorney Insight
Insight into plaintiff attorneys can provide critical information for how claims leaders and their defense counsel should approach a case. More often than not, if a claims organization had a case with a specific plaintiff attorney in the past, the adjuster on that case may be the only person with knowledge into what happened.
Which plaintiff firms are most likely to be willing to proceed to trial? What is the timing most commonly used by a specific plaintiff attorney to make demands or agree to consider offers? What is the delta between the first “real” demand in a case and the ultimate settlement value for a specific plaintiff attorney? Which respond best at mediation? Which get nervous with statutory offers? Which wait until the courthouse steps to get “real” with their demands?
These are very important data points in the nuclear-avoidance process.
Utilizing a system that captures all past case results, claims leaders can now understand patterns and potential threats from the plaintiff attorneys they face, significantly increasing their ability to determine strategies for more positive outcomes.
Insight into Workflow
Awareness of how a litigated case is proceeding at all stages of the litigation is critical. Knowing what strategy and steps were agreed to early in the case to prevent a case from going nuclear, or at a minimum to determine if the case has nuclear potential, is also critical.
What steps did counsel agree to undertake? What steps did the claims professional agree to take on? By when? The ability to know that the case strategy is on track or behind, and whether that strategy is producing the results the defense wanted them to have, is paramount.
In many of the nuclear cases we have analyzed, elements of the core case strategy were either never clearly delineated or weren’t being done in a timely way. Some were simply cases that “got away” and there was no clear direction or control. In others, the activities originally contemplated were in actuality revealing more damaging information, but without adequate recognition of that fact.
Technology can alert us to these variances in established strategy, highlight cases that appear to be “off-track,” and allow us to avoid the surprises that can so often result in nuclear outcomes.
Insight into Case Resolution Opportunities
As we all know, case resolution opportunities are best maximized at different points in the litigation process. These opportunities present themselves at different times on different cases. Similarly, each opportunity might require a different resolution tool (dispositive motions, deposition coordination, use of mediation and alternative dispute resolution forums, expert witness use, statutory offers—the list goes on.)
In a number of the cases we researched, opportunities for settlement were either not explored or were missed. In some, there was simply no consideration of many of the resolution tools we outline above.
Technology can deliver significant insights into these and many other questions. Being able to answer these questions factually, with structured data, is a huge step toward minimizing nuclear verdict exposure.
Having the right data means that the case is more likely to be assigned to the right defense counsel and that there are assurances that no case is being overlooked or “getting away.” But having the right data also means that the claims organization and its assigned attorneys have more insight into which resolution tools to use when.
I believe that clear insight and access to the right information at each stage of the process can help the claims organization make critical decisions to drive the best outcomes. And I believe that those tools, when combined with education, make a powerful combination.
Article written by Wesley Todd and first published in the Insurance Journal.