Dennis Costello and his team atSecond Chair Software have been working with insurance carriers toobtain video depositions of witnesses in litigation so that claimpersonnel can evaluate witnesses from their desktops. As Costelloexplains to Claims' Christina Bramlet, this creates a morecohesive partnership between claims and defense attorneys, theresult of which is greater control of case strategies and discoveryexpenses.

What was the catalyst for developing thisoffering?

Litigation is expensive. It costs the insurance industry $35billion per year. Expenses related to depositions account for 35percent of total litigation costs, meaning that the industry spendsbetween $10 billion and $15 billion yearly. Most cases require anaverage of two-to-four years to resolve, with 90-95 percent beingsettled, and the average paid loss continues to grow with time.

The fact is that few depositions are read by claim personnel,and even fewer are attended. Therefore, liability evaluations arebased on paper files instead of evaluating the actual human factor.As a result, the claim department is not aware of witness behaviorand how they would appear to a jury. There is limited visibility ofa discovery plan, and the discovery expense lacksprioritization.

It is evident that plaintiff attorneys' use of advanced trialtechnology — video, for example — far exceeds that of defenseattorneys. This puts insurers at a competitive disadvantage.

What are some alternatives to videodepositions?

The alternative would be to attend the actual deposition, whichis both cost and time prohibitive. The value of video is providingclaim professionals and attorneys with a method of effectivelyevaluating the impact of a witness. The capability to videotapedepositions has been available for years. Until now, the toolsavailable to view and search specific data in these videos has beenvery limited. A CD containing the entire deposition, which couldlast anywhere from four-to-eight hours, would arrive for the claimrepresentative or the attorney to review. Without the tools tosearch for and view the important points, the claim representativewould have to trudge through an entire deposition.

Describe the overall impact on the claimprocess.

Video depositions won't necessarily reduce the time spentprocessing a file. However, it will make the time more productive.Less time will be required to consolidate a complete picture of thediscovery schedule. On average, claim professionals should be ableto make settlement decisions sooner, and defense attorneys canplace greater emphasis on completing discovery more quickly. Afile's average shelf life should shorten significantly.

Other potential benefits include lowering allocated expensesthrough better legal process control and a reduction in the averagepaid losses from accurate evaluation of witnesses.

How does the service work? Does it require specialsoftware?

With its software-as-a-service platform, Second Chair isdesigned to be easily implemented. This minimizes start-up costsbecause there is no IT footprint, new hardware/software, ormaintenance programs to be adopted. All access is granted via theInternet. Its point-and-click capabilities facilitate quick accessto critical information, such as questions and responseshighlighted by attorneys. Users can conduct searches by depositionand use calendaring capabilities to accelerate discoveryprocess.

The entire electronic deposition can be viewed in several ways.For instance, we strip out all of the questions in the depositionand put them in a list so the claim professional can scroll downthe online list, selecting only the essential questions. Selectingeach pertinent question directs the user to the actual textdeposition or plays the answer in a video clip. The defenseattorney can also designate the most crucial questions for theclaim representative to review.

So is it always appropriate to use video?

Although we emphasize and encourage the use of video, we do notsuggest that video be used on all depositions. One key way to lowerexpenses using Second Chair is through our discovery calendar andcollaboration tools. These resources allow the claim department togain greater control of the case strategy and discoveryexpenses.

Video is used selectively on high-impact witnesses. Theremaining depositions are text-based but the Second Chair serviceprovides the previously unavailable capability to manage both thevideo and text-based depositions because of its cross-mediaplatform that integrates video, audio, and text.