Claims organizations and outside defense firms face monumental challenges today, resulting from both external and internal forces. The industry is faced with tough questions such as how to deal with outsized jury verdicts, how to recruit talent and train tomorrow’s leaders, how to measure value and success in the relationship between claims departments and defense firms, and how to improve communication among the key players on the defense side so that claims departments and defense firms can face their shared challenges together.
In 2024, CLM formed its Litigation Management Task Force to bring together claims departments and outside defense firms so they could constructively discuss the major challenges facing the industry and identify strategies and actionable ideas to address those challenges.
CLM Magazine, in print and online, has covered some of the Task Force’s highlights over the past two years, running Q&As with subcommittee leaders, publishing articles by Task Force members, and summarizing conference sessions and webinars featuring topics inspired by Task Force meetings and discussions. Now, the Task Force has published its first report, which summarizes its progress and activities; and outlines the topics highlighted over the past two years, the gains made on finding solutions to those topics, and the next steps for the coming year.
CLM President Susan Wisbey-Smith says, “The Task Force has been an incredible collaborative effort that has tackled many challenging topics and delivered work products that will truly make a difference. The very difficult conversations where all sides challenged each other were necessary to help move us forward.”
Through its Steering Committee and four subcommittees, the task force focused on:
• Counsel value optimization
• Cost management strategies
• Professional skills development
• Talent recruitment, retention, and optimization
The report breaks the Task Force’s progress down by subcommittee.
Counsel Value Optimization
What is a win? This was a question the Counsel Value Optimization subcommittee tackled, and it was the subject of a CLM Magazine feature authored by subcommittee member Tad Eckenrode, managing principal of Eckenrode-Bauman. While it seems like a simple question, it gets to the heart of a topic this subcommittee discussed at length: how insurers and defense firms define, measure, and communicate legal value. Subcommittee members found that “success” varies by client objective, case type, and litigation posture. A favorable outcome may not be simply a defense verdict at trial, and might instead include early resolution, cost-effective settlements, or meeting a clearly defined expectation on a given claim.
The report also notes, “A core issue discussed by the subcommittee is that many outside defense attorneys believe their work is not consistently recognized or appreciated by carrier claims counterparts, creating a need for more transparent expectations, better feedback mechanisms, and clearer demonstrations of value.” To that end, the subcommittee discussed developing practical and collaborative performance metrics. Questions considered include:
• What constitutes appropriate KPIs?
• How can law firms track and report performance?
• How should communication quality be measured?
• How can carriers and firms align around what success looks like on a file-by-file basis?
Going forward, the Counsel Value Optimization subcommittee will explore different alternative billing approaches and will conduct a survey that will serve as the basis for a whitepaper on various models, their usage, successes and failures, and lessons learned.
Much work remains before consensus and solutions emerge, but progress has been steady. Commenting on the subcommittee’s work and discussions on alternative billing approaches, Eckenrode says, “Conceptually, carriers generally might like to see the ‘billable hour’ end, but it is hard to see change coming soon. To that end, we still haven’t reached an ‘aha’ moment because implementing [an alternative billing model] remains challenging for a variety of reasons, not the least of which is trying to figure out a method that makes it beneficial to both parties (carriers and counsel) without one or the other feeling they got the short end of the stick.”
Eckenrode adds, “I think that, broadly, carriers do value the work outside defense counsel have done and are doing, so it is less of an issue of defense counsel not feeling valued as it is an issue of whether they are being compensated appropriately.”
Subcommittee member Bob Kopka, founding partner, Kopka Law Group, agrees that relationships between carriers and defense firms are generally improving. He also notes the progress that has been made so far in finding solutions to the compensation dilemma: “There was a consensus that moving from hourly billing to alternative billing models is inevitable because hourly rates do not reward innovation, efficiency, or quality of work—whereas, models that highlight key performance indicators such as reduced cycle time, accurate evaluation of likely outcomes, pro-active strategies, and positive outcomes are all measurable and provide a clear benefit to the clients. These KPIs will transform the relationship to one of mutual benefit and aligned goals.”
Cost Management Strategies
Billing remains an obstacle in the relationship between carriers and outside defense firms, and this was the main area of focus for the Cost Management Strategies subcommittee. “Its discussions reflect a broad concern that legal fee management has, in many situations, become overly burdensome and disconnected from the larger goal of achieving effective litigation outcomes,” notes the report.
It adds, “The subcommittee devoted substantial attention to the weaknesses of the hourly billing model and the promise and limits of alternative fee arrangements.” Discussions also focused on the economic impact of discounts, e-billing fees, prompt-pay structures, and expense fronting.
Much attention was given to the difficulty of complying with numerous carrier-specific requirements, and the need for litigation management guidelines. As a result, a workgroup was spun off from this subcommittee to craft a set of litigation management guidelines to serve as a strategic scaffold that organizations can adapt to their size, structure, and risk appetite. The guidelines will be made available for comment by CLM membership and then unveiled in September at CLM’s CCO Summit in Baltimore.
Professional Skills Development
Litigation work is getting increasingly complex due to forces such as artificial intelligence (AI), third-party litigation funding (TPLF), and nuclear verdict trends. The Professional Skills Development subcommittee focused on identifying and teaching the technical knowledge and skills required for modern claims and litigation management professionals.
Based on the subcommittee’s discussions, working groups were formed that focused on:
• TPLF—how it influences case strategy and identifying indicators of funding involvement.
• Artificial intelligence—legal AI tools and their application in the defense practice, ethical boundaries, and law firm policy development.
• Nuclear verdicts—practical education around jury behavior, reptile theory, social inflation, and strategies to humanize defendants and identify elevated verdict risk early.
A significant discussion point was the realization that foundational skills were lacking among newer professionals. Due to these subcommittee conversations, CLM launched its Insurance 101 webinar series, covering topics such as:
• Coverage 101
• Fraud 101
• Claims Investigation 101
• Ethics 101
• Reserving 101
• Reinsurance 101
• Negotiations 101
• Risk Management 101
• Litigation Management 101
In addition, CLM launched its Leadership Accelerator program last year to help develop skills for professionals new to management positions. “The hybrid program that culminated in an in-person session at CLM’s Annual Conference was successful,” states the report. “Plans are in place to form a second cohort in late 2026.”
CLM, with the help of this subcommittee, will continue developing educational content going forward, specifically around combatting nuclear verdicts and managing cases involving TPLF. Materials will include whitepapers, articles, webinars, and workshops. “Additionally, we are exploring creation of contributory databases that could include plaintiff expert witnesses and other content,” the report says.
Talent Recruitment, Retention, and Optimization
Recruiting and retaining talent has long been a challenge for the insurance industry as a whole, and that includes claims organizations and insurance defense firms. The Talent Recruitment, Retention, and Optimization subcommittee has worked to discuss specific barriers and identify practical solutions. “Part of this work has focused on outreach to students and educational institutions,” the report notes.
The industry’s messaging to younger talent was a particular area of focus. “Members observed that the plaintiff bar often has a stronger presence in law school environments, and they argued that insurance defense needs to be positioned more clearly as work that protects businesses, supports affordability, and helps people manage risk and recover from loss,” according to the report.
On retention, the subcommittee focused on mentorship, informal networking, and cross-functional development. Specifically, the report states, “Rather than relying solely on highly structured mentoring programs, the group focused on lighter-touch formats such as informal coffee conversations, rotating lunch-and learn sessions, and practical exchanges between claims professionals and attorneys.”
Subcommittee member Matt Morrison, vice president of litigation, American Family Insurance Company, says of the subcommittee’s work so far, “The level of engagement and participation from all members of the Task Force has been impressive and inspiring.”
One initiative this subcommittee will focus on going forward: dual-sided training tracks to help young attorneys understand client expectations and vice versa. Morrison says this will help young attorneys “learn more about claims expectations, reserves, and billing requirements, while claims professionals gain stronger grounding in litigation processes, legal deadlines, and ethical considerations.”
Across the Task Force’s four subcommittees, difficult conversations were held and progress was made on some of the biggest issues facing carriers and insurance defense firms. Steering Committee member Steve Donnelly, chief service officer, Amerisure Mutual Insurance Company, observes, “It is critical that both carriers and the insurance defense bar remember we are partners in fighting legal system abuse. As such, we need to support one another in a way that allows for our mutual success. The CLM is playing a pivotal role leading the efforts to bring both groups together and helping us have a common understanding of the challenges we each face as well as collaborating together to develop solutions to those challenges.”
Susan Wisbey-Smith concludes, “The Task Force has helped create the tremendously successful Insurance 101 webinar series that delivers needed foundational education. It has opened lines of communication among all parties to focus on strategy and outcomes. No other organization has the community and the reach to be able to facilitate this work. CLM is proud to serve as the nexus.”
About the Authors:
Phil Gusman, director of content; Fran Clark, specialty content manager; and Angela Sabarese, associate editor, are with CLM.