Poor communication and friction between claims professionals and defense counsel are problems that have long affected the insurance industry. To address the persistent pain points that arise between carriers and counsel, CLM launched its Litigation Management Task Force in 2024, which brings together leading voices to identify strategies that bring both parties into greater operational alignment and foster improved collaboration to address shared problems.
Task Force Steering Committee members and CLM fellows Krista Glenn, executive vice president and chief claims officer, Westfield Specialty Insurance; and Matt Morrison, vice president of litigation, American Family Insurance, will deliver a presentation at CLM's upcoming CCO Summit in Baltimore, beginning Sept. 9, that outlines the development of standardized litigation management guidelines designed to strengthen alignment between claims professionals and defense counsel.
“We cannot effectively stem the tide of social inflation and legal system abuse without true partnerships between carriers and [defense counsel] that focus on delivering superior outcomes,” Glenn and Morrison emphasize. “The current process is broken. More attorneys are switching from defense to plaintiff firms than we have ever seen before.”
They note that small- and medium-sized firms are struggling to stay afloat financially, with many being forced to take out loans to carry millions of dollars in fees and expenses that are owed to them. “Asking counsel to advance certain types of fees and expenses for the carriers and then requiring them to wait months or a quarter for reimbursement places a significant financial burden on many [defense] firms in the aggregate. It can contribute to firms closing and/or consolidating. Constant cutting of bills and delayed payments are having a profound impact on counsel’s ability to train, retain, and compensate their staff.”
Standardizing Litigation Management
The Litigation Management Task Force found that expecting counsel to navigate myriad sets of guidelines—many of which are largely similar but differ enough to create challenges—was causing unnecessary friction in counsel-carrier relationships, the two experts explain. As a result, “various members of the Task Force collaborated to design a standard set of litigation management guidelines.”
After reviewing dozens of different sets of guidelines, the Task Force discovered that most companies are more similar than they are different, and that there were some guidelines that were outdated and needed a refresh. “We hope that the CCOs will see that they aren’t losing anything by adopting the guidelines,” note Morrison and Glenn, “but instead see [them] as an evolution and refinement in litigation management. [They are] designed to enable their teams to better act in true partnership with counsel and in the best interests of the insureds, which is everyone’s goal.”
Recommendations for Improving Litigation Management
Some of the best strategies to strengthen alignment between claims professionals and defense counsel, according to Morrison and Glenn, include “embracing the need to collaborate effectively, removing unnecessary complexity from the process, and appreciating the needs of each other.”
They emphasize that although expenses—particularly litigation costs—are an important area of focus for litigation management programs, they are only one part. “We would encourage CCOs to adopt a holistic view that measures the total cost of claims (defense costs plus indemnity) across a book of business in order to gauge success.”
The two experts also encourage carriers to consider more creative ways to compensate counsel, including alternative fee arrangements beyond the traditional flat fee plans. “The advent of AI makes this even more imperative,” they state. “We need to collectively [promote] innovation and adoption of tools and technologies that will lead to the best outcomes.”
All in all, Glenn and Morrison hope the session is a conversation more than a presentation. “The CCOs should come ready to talk openly about this issue,” they suggest. “We don’t expect to change the world in one session—but we hope that this [conversation] can be the catalyst to the change that is needed.”