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Personal Injury Settlements in the age of COVID-19

3 minute read

I’m going to say something that might come as a surprise – I’ve been impressed by the professional approach and willingness to negotiate in good faith that has been displayed by many insurance companies, their adjusters, and their counsel, over the last three months!  There, I’ve said it!  Credit where credit is due.

Based solely on my experience with my own clients and with my own (digital) filing cabinet, I’ve observed a commendable willingness on the part of many insurance companies to try to reach a settlement of a claim that makes sense for both parties.  I can’t negotiate for a client unless the other party is also willing to talk.  I had some concerns when the pandemic hit and all of us moved to work remotely that, if an insurer simply said “No” to any of my requests to discuss a file, the insurer would have the upper hand and my clients would be left to wait.  I've been pleasantly surprised that my fears did not come to pass.

Three months into this new way of conducting business, I’ve been able to reach appropriate settlements relating to both tort lawsuits and accident benefit claims on an accelerated basis.  For many insurers on many files, it seems that, rather than capitalizing on these unusual times to delay and thwart claimants, their business imperative has led them to conclude that the old adage of “the best file is a closed file” should continue to drive business decisions.  In fact, from what I’ve seen, insurers have been just as worried as my clients about how they are going to adjudicate claims and achieve resolutions.

For the lawyers who do this kind of work, the last quarter of the year – October to December – is often called “settlement season”.  This is because there appears to be an increased incentive for insurers to clear files that can be resolved off the books before year-end so that the exposure on the case is stripped from the books as well.  What I’ve been seeing is a comparable effect, related to the COVID-19 lockdown.  While some parts of what we do have been suspended, the ability to talk through a case to reach a settlement is within the grasp of anyone willing to talk.

On files where relevant and appropriate productions have been exchanged, settlements have occurred on my initiation, but also on the initiation of the insurers themselves through their adjusters and counsel.  I’ve been approached directly by insurers in a manner familiar from past “settlement seasons”, but which is definitely not common during the March to June timeframe.

This is good news for personal injury claimants, many of whom have a whole new set of financial pressures - given layoffs from work and other financial pressures that have occurred during the pandemic - on top of their accident-related challenges.

None of this is to say that insurers are abdicating their duty to carefully adjudicate claims; they still ask the tough questions and flesh out the various issues of liability, causation, and damages.  But the willingness to talk, to be fair, and to reach appropriate resolutions is reassuring.

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Andrew C. Murray

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