Is your claims department losing money on unnecessary litigation? If you’re not employing robust Early Resolution Strategies (ERA), the answer is probably a resounding “yes.” But don’t worry, savvy claims leader – we’re about to turn that ship around.

In my years of working with insurance companies, I’ve seen far too many claims spiral into costly legal battles that could have been avoided with proper ERA. Today, we’re diving into five game-changing strategies that will help you minimize litigation costs and keep your CEO smiling when they review those quarterly reports.

Why Early Case Assessment Matters

Before we jump into the strategies, let’s remind ourselves why ERA is so crucial. Early case assessment is your claims department’s crystal ball – it helps you predict the likely outcome of a case, estimate potential costs, and decide on the best course of action early in the process. Go review some recently settled claims and ask could the decision to settle have been made sooner? Would that have changed the approach to litigation spend? Faster resolutions, lower costs, and happier policyholders is certainly a desirable outcome. Now, let’s get to those strategies!

5 “Must-Implement” ERA Strategies

1. Embrace Data Analytics – If you’re not using data analytics in your ERA process, you’re flying blind. Modern claims systems are treasure troves of historical data. Use this data to identify patterns, predict outcomes, and make informed decisions.
2. Implement a Standardized ERA Checklist – Don’t leave ERA to chance or individual discretion. Develop a comprehensive checklist that covers all aspects of early case assessment. This should include liability analysis, damage evaluation, potential defenses, settlement value estimation, and litigation cost projection. A standardized approach ensures consistency and helps less experienced adjusters spot potential issues early.
3. Leverage Technology for Document Review – Gone are the days of manually sifting through mountains of documents. Invest in technology that can quickly analyze large volumes of data. AI-powered document review tools can identify key information, flag potential issues, and even suggest similar past cases – all in a fraction of the time it would take a human.
4. Collaborate with Legal Early and Often – Your legal team shouldn’t be an afterthought in the claims process. Involve them early in complex or high-value claims. Their expertise can help identify potential legal issues, assess the strength of the case, and develop effective strategies. Keep everyone on track and the outcomes will improve.
5. Train Your Team in ERA Best Practices – The best ERA tools in the world won’t help if your team doesn’t know how to use them effectively. Invest in regular training sessions on ERA best practices. This should cover not just the technical aspects of assessment, but also soft skills like negotiation and communication. A well-trained team can turn your ERA process into a powerful cost-saving machine.

Putting It All Together

Implementing these strategies isn’t a one-and-done deal. It requires ongoing commitment, regular evaluation, and a willingness to adapt as you learn what works best for your organization. But trust me, the payoff is worth it. I’ve seen companies reduce their litigation costs by up to 30% through effective ERA strategies.

Remember, every dollar saved in unnecessary litigation is a dollar that goes straight to your bottom line. And in today’s competitive insurance landscape, that’s an advantage you can’t afford to ignore.

The ERA Challenge

Here’s a challenge for you: take a look at your last 10 litigated claims. How many of them could have been resolved earlier with a more robust ERA process? If the answer makes you uncomfortable, it’s time to take action.

What ERA strategies have worked well in your claims department? Or what challenges are you facing in implementing ERA? Share your experiences in the comments below – let’s learn from each other!