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Thu, Dec 14, 2006
The time has come for the reinsurance industry to embrace mediation instead of constantly litigating its way through costly disputes. Maybe we have heard that view before but this time something concrete is being done about it- there is a new initiative by the International Institute for Conflict Prevention and Resolution call the International Reinsurance Industry Dispute Resolution Protocol, aimed at achieving significant savings in legal costs.
Policyholders rightly seek value-added claims services. We are required to keep "customers" focused and learn more about using alternative dispute resolution solutions in helping to preserve valuable commercial relationships. Mediation is something that must be added to the 'litigation management toolbox'.
The legal profession had become so mesmerised with the stimulation of the courtroom contest, that lawyers had forgotten that they ought to be healers- healers of conflict, and not warriors nor hired guns. There are certain times when a coverage issue or complex claim situation should be resolved through formal litigation but the industry needs judicial guidance. We need legal precedent for future reference.
However, there is a new movement afoot, in part driven from across the Atlantic. Smart lawyers have already detected that clients believe there is good reason for a shift in thinking; smart lawyers recognise a significant change is about to happen; and smart lawyers have sought to re-skill and train in the art of mediation.
To become an effective mediator, new skill-sets needs to be learnt- it is imperative that every insurance group should have a trained mediation capability built in to its claim function resource.
The CPR International Reinsurance Industry Dispute Resolution Protocol is a major step forward, and complements and supports the need for mediation clauses to be incorporated within reinsurance agreements. The CPR group is in the process of working with the Centre for Effective Dispute Resolution to produce a training module for insurance and reinsurance professionals who wish to become accredited in mediation.
I am excited about the prospect for changing the way we resolve disputes. Collectively, we can do more than just make a significant shift in thinking- we can start to take action.
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