An Insurance Defense Attorney’s Perspective on Effective ADR

I would like to share my perspective on how to make the most of the ADR process.  In my 33 years as an insurance defense attorney I have participated in hundreds of mediations. I have also served as a volunteer mediator for the courts in over 100 cases.  In my view ADR is the most rewarding and productive part of litigation. It is a time where parties can amicably resolve their disputes rather than relying on the arbitrary decision of a judge or a jury. Here are six ideas on how to make your ADR experience more effective.[1]

1.    Be courteous

It has been said: “Speak when you are angry and you will make the best speech you will ever regret.”[2] Be kind and respectful. Shake hands and smile.  Compliment the other side. Be self-deprecating. If appropriate tell them you are sorry. Whether you settle or not, leave with a kind word.

2.    Use the joint session to your advantage

The joint session is a time to listen and to share. Do both. Do not allow the mediator to control the flow of information by breaking you out into caucuses too soon. Invite the other side to open up and tell how the injury has impacted their lives. Something good happens when people feel heard. Once they have had their “day in court” they may feel emotionally ready to let go and settle the matter. Actively listen and do not argue or correct.

3.    Watch your body language

There is nothing worse than watching your client non-verbally accept a bad offer. It can be in the form of a smile, a nod of the head or the relaxing of a previously tense body stance. Work together as a team and practice how your body will react to new information.

4.  Anticipate concession patterns

Before you start your mediation try to guess the other side’s opening demand. Map out your responding number. Take it a step further and try to foresee the next demand and your response to it. Keep pushing the limits of your imagination until you reach the final settlement number. Readjust your figures if the ending point is not to your satisfaction. Remember that “tapering” (each concession systematically less than the one before) sends a strong message to the other side of where you want to end up.

5. Guard your bottom line

“Tapering” can send a strong message of where you want to end up, but you still want to guard your actual bottom line. Mediators are masters at figuring out your bottom line. Don’t fall for the trick of guessing what the other side is willing to take or guessing what the next offer will be. Those are tools used by mediators to read you.  Something unintended will escape you (verbally or non-verbally) when you bite at these lures. Your bottom line is something to keep to yourself—always—especially when the mediation is over.

6.    Watch out for last-minute grabs

We tend to relax and get sloppy when we are close to a settlement. Keep your guard up. Slow it down. Too much unintended information is disclosed when we are tired or impatient. The skilled negotiator will capitalize on your weakness and seek one more baby splitting move; or one last ditch effort to recoup the cost of the mediation; or one unacceptable settlement term relating to liens or the timing of the payment. Stay in the zone until you leave the building and are safely in your car.

In conclusion, effective use of ADR is a learned skill. The more you do it the better you get at it. When used correctly it can be the most rewarding and fulfilling part of your practice.

Footnotes:

[1]The views expressed are my own and do not necessarily reflect those of my employer State Farm.

[2]This quote has been attributed to American editorialist, journalist, short story writer and satirist—Ambrose Bierce.


Philip M. Andersen is the Managing Attorney of the State Farm Insurance Company In-House Litigation Department in Pleasanton (Philip M. Andersen & Associates). He has extensive litigation and trial experience defending policy holders in personal injury lawsuits. He has been managing in-house insurance litigation offices since 1994. Contact Phil at (925) 225-6838 or philip.andersen.nx32@statefarm.com.

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