EFFECTIVE USE OF EXPERT WITNESSES IN INSURANCE AND REINSURANCE DISPUTES
CD: Reflecting on the last year or so, how would you describe the level of insurance and reinsurance disputes arising in the market? How does this compare to previous years and what are the key drivers?
Knutson: The level of disputes in the market has increased over the past few years. While not all of these disputes have resulted in formal legal action, the upward trend is clear and has been driven by two key factors. First, the increased spreading of risk has introduced multiple insurers, reinsurers and even non-traditional players into the claims process. As a consequence, the number of decision makers and viewpoints on any individual claim has increased, as has the scope for conflict. Second, more so than ever before, insurers are putting their clients and their submitted claims to the test. This can include simple policy wording reviews, checking for breach of duty and conditions, detailed discussions on coverage ambiguity, and the appointment of an array of experts to collect, prepare and adjust a claim according to the insurers’ instructions. Minimising the risk of such disputes therefore requires careful and detailed control of the claim management process, including professional preparation of the claim, proactive relationship management of all stakeholders and addressing issues early on.
Oct-Dec 2017 issue
Marsh Risk Consulting