Economies of scale achieved through contract negotiations, establishing an upfront litigation strategy, and the adoption of e-billing have led to some advances in both claims and litigation management systems. However, only a handful of insurance companies have taken full advantage of the opportunity to improve their claims legal operations. Many companies still find themselves relying on legacy systems, incomplete data, and cumbersome processes that erode profitability and jeopardize competitiveness.

Challenge: Legal and claims data quality is low and poorly integrated with core claims systems and legal management systems.

At many companies, much of the data that supports an effective performance-based decision support system exists in multiple operational systems. This lack of a central data source impedes insurers' ability to make decisions, which in turn affects attorney performance ranking, case assignments, and case management. Moreover, even when carriers do establish formal legal performance management practices, they often fail to capture the underlying data that supports meaningful metrics (e.g., outside legal spend by phase by defense plan, negotiation savings, and inside counsel savings).

Challenge: Current litigation processes lack an analytical basis.

Management faces constant pressure to deliver quick, efficient and effective claims processing. Even in environments that stress effective claims processing, the underlying foundation – business knowledge, strategy and plans – may not have a strong analytic basis. Without a clear understanding of how to improve processes, even the best intentions are likely to fall short.

Special Reports /

Managing claims legal expenses

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