End of the year settlements – Tis the season to get settled
Author(s): Stephen M. Birman
December 20, 2019
After a decade of handling personal injury claims, I am able to confirm that insurance claims settle more frequently at the end of the year than at any specific time during the year.
There is something about the end of the year that adds motivation for everyone involved to find a resolution. But what is it?
For one, there is the basic economics.
Many insurance companies (and law firms too) close their books at the end of the year. Lawyers and insurance adjusters are always prioritizing, and at the end of the year, the priorities often shift, in tandem, from preparing those ‘brilliant’ legal arguments to trying to assess which claims have a chance of resolution.
Additionally, many accident victims are motivated by the prospect of starting a new year without the stress of litigation on their plates. This may result in some clients reconsidering earlier offers and/or pushing for further compromise. Whether a settlement is attainable or not, the end of the year is always a good time for clients and lawyers to connect and review their plans and objectives.
Sometimes at the end of the year, mediators will try and reach out to the parties who were involved in their failed mediations from earlier in the year. In my view, every mediator should adopt this type of follow up practice to provide an added value service.
At the end of the year, parties may also be less suspicious of settlement overtures. When a party reaches out to the other side unexpectedly in earlier months, the internal questions are often why do they want to speak about resolution now? And, what do they know that I don’t? At the end of the year, these motivations are less likely to be scrutinized because it’s just that time of year.
Where possible a FAIR resolution of this time of year is ideal for the parties, especially vulnerable accident victims who can look forward to the holidays and the new year and finally put years of litigation behind them.