In a new record, nearly 520,000 insurance claims disputes valued at more than $2.4 billion were resolved via arbitration in 2011, Arbitration Forums Inc reports.
According to AF, the nationÃ¢â‚¬â„¢s largest provider of inter-insurance dispute resolution services, it is saving the property/casualty insurance industry more than $700 million in litigation costs annually.
Disputes leading to arbitration typically arise when insurance or self-insured companies believe their insureds are not at fault or disagree over the percentage of liability or the amount of damages.
Over 85 percent of inter-company arbitration disputes involve auto collisions.
W. Russ Smith, president and chief executive officer of AF, said:
Some 98 percent of the arbitration filings in 2011 were made electronically, via AFÃ¢â‚¬â„¢s electronic subrogation claims system known as E-Subro Hub Ã¢â‚¬“ more than twice the percentage of a few years earlier.
E-Subro Hub expanded to all 50 states in 2011 and handled subrogation cases valued at more than $1.4 billion.
AF noted that eight of the 10 largest auto insurers in the United States have already moved their subrogation process to E-Subro Hub, and it projects that 80 percent of the private passenger auto market will be using the system in 2012.
E-Subro Hub significantly streamlines the process by enabling users to electronically send and receive subrogation demands, attach supporting documents, manage subrogation claims and electronically file inter-company arbitration where necessary.