Plaintiffs attorneys have honed skills for identifying cases destined to result in nuclear verdicts, a former defense attorney working for a reinsurance company said recently, describing their tactics and laying out suggestions for countering them.

Executive Summary

In a series of articles, a reinsurance claims manager, an insurance research analyst, a litigation consultancy and reinsurance company chief executives discuss the drivers of social inflation, concluding that the trajectory of liability damages will continue spiraling upward post-COVID and recommend defense and insurer strategies for change. They advise strategies that focus on presenting better stories paying attention to confirmation biases, investing in more witness preparation, offering damage amounts even if the defendant has no liability and working to improve corporate images. (Part 2 of a Series)

In addition to focusing on client stories that will incite anger in jurors, plaintiffs law firms look for weaknesses in the storytellers on the defense side, Dana Franzetti, a claims manager in Swiss Re’s U.S. Property & Casualty Claims department, explained during a presentation on social inflation during the Casualty Actuarial Society Seminar on Reinsurance in early June. “Do corporate witnesses perform poorly during depositions? Do they get tripped up?”

According to Franzetti, they also seek to understand insurance programs and maximize potential recoveries by creating conflict between insurers participating on towers of coverage and driving wedges between the policyholder and its insurers—potentially setting insurers up for bad faith.

“They’re constantly trying to drive panic and instill fear in the policyholder,” she said. “They ask that every letter they send be sent to the policyholder as well,” she said, noting that in settlement demand letters, they may even offer to dismiss the policyholder and substitute the insurance company as the named defendant in the case. “They do this again to create conflict between policyholder and insurer,” she said.

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