Retailers should try reducing litigation by settling claims early
/Retailers face a triple whammy when dealing with insurance-related claims:
1. The number of claims resulting in litigation has risen between 20% and 40% over the past decade.
2. The cost of the losses suffered by claimants are up between 130% and 160%.
3. The average time to resolve a case that goes to litigation has reached 400 days.
This is according to Luke Harrison, managing director and U.S. national practice leader for claims consulting at Marsh & McLennan Companies Services B.V., who spoke at the recent National Retail Federation Retail Law Summit.
Harrison suggested that retailers should try reducing litigation propensity by settling claims early rather than waiting for the matter to be settled in court. This advice should be considered by property managers as well, not only retailers.
Retailers should seek to reduce the number of claims open at any given time to reduce reserves that must be set aside to cover them, Harrison said. They should also develop a strategy to reduce the amount spent defending claims, including avoiding costly litigation when possible.