The legal landscape has witnessed a surge in nuclear verdicts, or jury awards in civil cases that exceed $10 million. According to a recent report from the U.S. Chamber of Commerce Institute for Legal Reform, the median reported nuclear verdict increased from $19.3 million in 2010 to $24.6 million in 2019, representing a 27.5% cumulative increase during a period when inflation rose by about 17.2%. Nuclear verdicts can have a significant impact on businesses, insurance rates, and the overall economy. And things are likely to get worse, with a Clyde & Co 2023 industry predictions report finding the number of nuclear verdicts will continue skyrocketing in 2023.
One under-discussed challenge associated with this trend is keeping case files organized throughout the claim and litigation process. Fortunately, there are proven ways for businesses, underwriters, and attorneys to reduce costs, increase efficiency, and substantially reduce the risk of errors and omissions. These three steps are essential.
Effective Data Management and Analysis
First and foremost, insurers must understand early case assessment and evidence preservation. A major pain point lies in the overwhelming volume of information and the intricacies of data retrieval processes, which are often still manual and complex. Both insurers and attorneys require accurate and timely information to develop a strong defense strategy, and finding the often-hidden details can be the decisive factor in any case.
In fact, according to the 2016 CLM Advisors report, “Industry Practices in Records Retrieval,” claims professionals spend 12% of the day—roughly six weeks every year—on records retrieval. To make matters worse, legal and claims professionals reported having to manually sift through five to seven records per case, taking an average of 30 hours to organize chronologically, and another six hours to search for keywords.
By harnessing technology—specifically, artificial intelligence (AI)—companies can streamline their operations and concentrate on case strategy and defense. AI enables large volumes of data to be handled and analyzed more efficiently, even when gathered from various sources across jurisdictions. An effective data and information management solution means utilizing valuable tools that facilitate decision-making and provide data visualization, trend analysis and reporting, and identification of data patterns or anomalies. Moreover, this solution should provide an executive summary that highlights the most important insights from files and a smart-search function for instant keyword retrieval.
Maintaining evidence in a comprehensive and well-organized manner is crucial to ensure a thorough examination of the facts while minimizing the risk of data loss or compromise. The right technology can help defendants allocate their resources efficiently, which promotes accurate information processing and allows companies to navigate complexities, educate juries, and facilitate information-backed presentations by expert witnesses.
The Right Expertise
Successfully navigating nuclear verdict cases also requires a team of experts familiar with state insurance and compensation rules, as well as legal rules pertaining to information intelligence.
While technology is an incredibly helpful tool, it is still crucial to assemble a team of legal professionals, investigators, and records retrieval specialists in advance who can ensure prompt and effective handling of serious claims.
Beyond getting the information from point A to point B, companies can streamline information intelligence by engaging with a network of experts that understands the nuances of various jurisdictions and can provide invaluable guidance throughout the case. By leveraging this network’s expertise, defendants can navigate the intricacies of nuclear verdict cases more effectively, develop robust defense strategies, and ensure compliance with relevant legal statutes.
Within that same consideration, quick and efficient information management can allow plaintiffs, defendants, or insurers the time needed to review and revise existing laws and regulations related to liability and damages to ensure they are fair, reasonable, and aligned with economic realities.
By utilizing the collective expertise of their team, companies can strengthen their defense or implement measures such as damage caps, structured settlements, or alternative dispute resolution mechanisms to promote more balanced outcomes.
Ironclad Data Security
In most nuclear verdict cases, high-stakes litigation and sensitive information are involved, making data-security even more paramount. Companies must always ask their partners about how they implement stringent security protocols and leverage advanced technologies to ensure that client data is protected from unauthorized access, breaches, and cyber threats. A recent IBM report found that companies can save an average of $2.66 million by forming an incident response team that tests their software and plan.
When evaluating your tech stack and the experts behind it, it is important to ask if those experts are adhering to all rules of evidence and data privacy for local, state, and federal laws.
Encouraging businesses to adopt comprehensive risk management practices—including safety protocols, employee training, and adherence to industry standards—will help reduce the likelihood of accidents and demonstrate a commitment to safety.
Data security plays a pivotal role in mitigating nuclear verdicts by safeguarding sensitive information, maintaining confidentiality, and ensuring compliance with regulatory requirements. Do the leg work up front when choosing your partners so your organization can confidently navigate the complexities of nuclear verdict cases while protecting against potential risks and vulnerabilities.
As nuclear verdicts continue to surge, businesses and legal professionals must recognize the importance of strategic information management to effectively navigate these high-stakes cases, while proactively minimizing potential liabilities and safeguarding their organizations in this challenging legal environment.
By streamlining data management and engaging with experts that are well-versed in unique laws on information exchange and management, organizations will be well-positioned to manage the risks associated with nuclear verdicts or have the resources necessary to push for mediation and arbitration as an alternative dispute resolution method.