Simplifying Claims Litigation
Best Practices for Successful Negotiations – Part 2
On our last blog, part 1 of Best Practices for Successful Negotiation, we discussed the first 2 of 3 best practices claims professionals can use to resolve their litigated claims earlier, without overpaying for it. First was to understand the true problem by uncovering true needs. The second was painting a narrative or telling a story that actually persuades opposing parties to see your point of view, before becoming overly entrenched in their stance.
Below we’ll touch on the 3rd best practice – taking advantage of the actual psychology behind negotiation. Or in other words, what you can do to help both parties come to a resolution.
The Actual Psychology
The psychology of how we perceive opportunities and threats is a fascinating science. Given that 98 out 100 files are going to settle, it is surprising that more claims organizations and law firms don’t teach neuroscience and economic game theory to their practitioners.
There are many academic sources from which to learn more about this topic, but one simple way to think about it is to avoid using negotiation approaches that trigger primitive, emotional responses. The part of our brains that is more primitive is the part that makes it harder to reason through problems and arrive at a solution. This is the basis of the Reptile Theory so popular with plaintiff attorneys.
Anytime we feel threatened, it triggers this part of our brain. And humans subconsciously perceive all kinds of things as “threats,” including any statements of opinion with which we strongly disagree. Our heart rate goes up, our blood pressure and breathing rate goes up, our bodies pump out adrenaline and cortisol, and we go into flight or fight or freeze mode. And when you’re in one of those modes, you’re not trying to “get to yes”!
Do you think the following statement is likely to get opposing counsel to consider your perspective on the case and consider your negotiation offer: “You don’t have a case! You are going to lose, and lose badly! Our case is so strong! We are going to get a defense verdict. We don’t see any liability. We always win our cases!”
Those types of aggressive strong negotiation positions have been shown to produce the unintended consequence of fighting back, shutting down the conversation, or freezing. And of course, be self-aware when opposing parties use similarly unhelpful language with you. You may be subconsciously shutting down negotiation opportunities just because they are bad at their negotiation language.
Instead, use language that is positive. Studies have shown that doctors are far more likely to recommend a surgical procedure when it’s described as having a “90 percent survival rate”, rather than when it is described as having “a 10 percent mortality rate.” Instead of “you will lose,” consider asking the other party to “consider the possibility, however small, that we will win.”
At CaseGlide, we offer a collaborative platform that allows both claims handlers and their attorneys to work in unison on their cases. As negotiations progress and settlement opportunities arise, claims professionals can react quickly to shorten case cycles and settle cases long before they become expensive and resource-consuming. Contact us to view a demonstration of our claims litigation solution and start closing cases faster and with better outcomes for your organization.