Table of Contents
- Profile of Participants
- Key Findings
- Litigation Frequency
- Litigation Disposition
- Litigation Outcomes
- Litigation Management Litigation Expense
Appendix: Benchmarking Results
It is clear that the cost of managing an insurance claim varies by line of business. While there is ample data to support general claims segmentation and analysis, there has been limited information available to analyze the cost of managing litigation claims by line of business. Over the years, claims organization found themselves managing claims litigation statistics manually, on spreadsheets as most legacy claims systems were not designed to capture relevant litigation data. With the introduction of business intelligence tools, the availability of litigation data has significantly increased. This benchmarking study is the first of a kind to specifically address litigation indemnity, expense, staff and productivity metrics by line of business.
Participating companies were asked to provide statistical responses to over 100 questions focused on claims litigation statistical performance for 2008. Statistics were collected at a company-wide level and for the following individual lines of business: personal auto, commercial auto, homeowners, commercial property, general liability and workers compensation. Responses were collected between February and April 2009. The data provided by the participating companies was screened for reasonableness. Data that was deemed invalid or inconsistent was excluded from the results. No results were provided if there was insufficient data for a particular line of business or benchmark group. The following briefly summarizes the primary benchmark groups used for the study:
- Size: Companies were classified based on total annual premiums written. The small companies were defined as those with total annual premiums under $500 million. Large companies were defined as those with total annual premium over $500 million.
- Business Mix: Companies were designated as either personal lines writers or commercial lines writers based on their predominant mix of business. Nine (9) of the companies were designated as personal lines carriers, while eleven (11) were classified as commercial carriers.