Who’s Pulling the Strings? When an Insurance Company is Protecting the Defendant

Much has been written and opined about regarding the motivations of parties to lawsuits to press litigation or else to mediate a dispute. After all, understanding these motivations is a key puzzle piece in mediating and settling a dispute. However, when an insurance company is providing a defense for a party to the lawsuit, the motivations and policies of that carrier are suddenly very different, as they become a prime decisions maker in the dispute.

At Asheville Legal, we most often see insurance carriers paying the defense lawyers for defendant builders in construction defect lawsuits. This is because commercial general liability policies typically require the carriers to provide such a defense if and when they are sued for negligence. We also often sue carriers directly.

When an insurance company is paying for the fees of the defense attorney and whatever settlement or judgment might result against its insured, you have to shift your analysis. After all, insurance carriers are playing a much longer game: Your case is probably just one among thousands in which the carrier might have liability.

Therefore, carriers can be less concerned with the costs of a single case, and tend to be more concerned about how their cases are getting resolved across all their claims. For example, in our experience, insurance companies tend to wait until the very last possible minute before trial before making meaningful offers to settle.

We believe this is part of a broader strategy to send a message to plaintiffs and their lawyer: There will be no quick and easy pay-outs. Such a message across the marketplace tends to protect the carriers’ bottom line in the long run by discouraging lawsuits entirely.

So, if you’re dealing with an insurance claim or an insured party, and you want more insights into the carrier’s motivations to settle, or perhaps not settle, then give Asheville Legal a call today. We have the expertise and experience to help you negotiate an optimal result.