Much attention has been given to online mediation, in addition to other types of online dispute resolution (ODR), as it has seen widespread acceptance as of late due to restrictions on in-person gatherings. Is that acceptance forced in light of the need to keep claims moving forward with no viable alternative, or are parties finding that online mediation may, in fact, be preferable to face-to-face in some cases?
It is widely known by claims professionals and legal practitioners that most lawsuits resolve before trial, and that mediation is an effective tool for settling claims. Nevertheless, until recently, online mediation has largely been eschewed by counsel. (Ironically, insurance company and TPA representatives for several years have been asking whether they could attend mediations via Skype or other remote options. Perhaps they were ahead of the curve)
The general rationale seemed to be that interacting by electronic means is simply not as effective as face-to-face discussions. While that may be true in some respects, the current environment has proven that, for many cases, online mediation can be as effective as face-to-face mediation. In fact, it may be preferable.
In many “run-of-the-mill” personal-injury claims (i.e. automobile collisions, and slip and falls) the mediation centers around the issue of whether the parties can agree on an acceptable settlement amount, and how to bring them to that point under the particular circumstances of the case. That is not to say the discussions are simplistic, or that there aren’t other issues involved that need to be addressed. However, these elements are often ancillary to the ultimate financial stance of the parties and involve less emotion than, say, a divorce or contentious commercial dispute.
Accordingly, the online environment allows for very effective discussions. In addition, these claims are typically two- or three-party disputes, making an online mediation relatively simple to navigate. Because parties in personal-injury disputes rarely get together in the same room for direct discussions, there is no substantive in-person communication between the parties lost by conducting mediation online. Reports over the past several months have indicated that settlement rates have not dipped since mediation has moved almost exclusively online.
Benefits of ODR
One of the most obvious benefits of ODR is the cost savings in the overall process. Eliminating travel costs can be significant for both sides. An out-of-state insurance adjuster need not invest the money and time of multiple days traveling across the country to attend a mediation in person. These savings can go towards indemnity rather than expense, thereby increasing the chances of settlement. Likewise, a plaintiff who has moved out of state or lives in a remote area no longer has to travel for an in-person mediation. Even ‘local’ plaintiffs and their attorneys save on costs such as gas, parking, and lunch.
We are also now in the fourth quarter, i.e. “settlement party” season. With that comes bad weather, delayed flights, snow-blocked highways, and cancelled mediations. All of that is out the window when meeting online. Coordinating structured-settlement brokers, videographers, translators, and stenographers is simplified; mediator travel time is eliminated; and reports show that online mediations run slightly shorter than face-to-face, offering additional potential savings.
Beyond the obvious cost savings, there are several other benefits to ODR. First, communication can be had in a variety of ways. Zoom, with its breakout rooms, is proving very effective for online mediation, allowing the mediator to create any number of private conference rooms and move participants in and out of these rooms as desired. There are several other platforms that also allow for effective video, audio, and/or text-based discussions, and some larger ADR providers have created their own secure, purpose-built virtual mediation platforms as well.
While it is most likely necessary to meet with the plaintiff and his attorney by video, the same may not be true with defense counsel and/or an insurance representative. Depending on the nature of the discussions and the comfort of the parties, telephone calls, emails and/or text messaging may be all that is necessary for much of the process. Accordingly, participants may not need to sit in front of the computer waiting for the mediator’s next communication like they were sitting in a conference room; they can convene when necessary and go about their business otherwise.
Similarly, because the mediation isn’t constrained to a physical location (i.e. a Dispute Resolution Center or law office), ODR allows for more flexibility in scheduling and design of the process. “Zoom fatigue” is real; to avoid it, or perhaps address other scheduling conflicts, mediations can more easily take place in multiple, shorter sessions when done online. Granted, there may be some benefit to having a prescribed time frame for the mediation, but the point is the parties are empowered with more flexibility to design the process to their needs. In addition, an online mediation can easily be scheduled on short notice and conducted in a few hours–at a cost appropriate to the claim.
One significant, but perhaps less obvious, benefit is that ODR offers parties access to a greater range, and therefore a more diverse field, of mediators. Whether a particular party relates to a mediator can play a significant role in a successful mediation. Yet, we continue to hear concerns about a dearth of mediators who might resonate with underrepresented individuals.
While we can’t magically increase diversity in the percentage of mediators, the power of technology offers better access to diverse mediators. Parties to a dispute will now find it easier to utilize individuals of various genders, ethnicities, and backgrounds should that be a factor in the mediator-selection process. Not only will this maximize the likelihood of a successful resolution, using situationally desirable mediators may also foster the needed influx of underrepresented individuals to the mediator ranks.
Another advantage is it becomes more convenient to gather, or assess, additional information in the event doing so becomes necessary for negotiations to proceed. It is no secret that insurance companies need time to evaluate evidence and issues in order to establish the settlement authority they will be working with at mediation. Sometimes, however, parties come to mediation with new and/or previously undisclosed information, despite a mediator’s best efforts to encourage all necessary information be exchanged in advance. Because of the flexibility with ODR, the parties can more easily adjourn the mediation, take whatever time is necessary to evaluate new information, and reconvene online.
In fact, without the need for travel, ODR can easily accommodate as many “pauses” as will benefit the process. While frustration may not be eliminated, the flexibility with ODR should minimize feelings that one “wasted the day“ had the same occurred with an in-person mediation involving extensive travel.
ODR also allows for easier participation of all interested parties. While many jurisdictions typically require that parties with ultimate decision-making authority attend the mediation, the reality has often been that the insurance representative with ultimate decision-making authority may be participating from afar; sometimes only via defense counsel or a local adjuster, and is difficult for the mediator to determine how much participation is really occurring. With ODR, direct communication between mediator and the ultimate decision-maker can become the norm, increasing the chances of settlement.
The above is not an all-inclusive list. Without expounding, additional benefits include the ease of conducting activities such as exchanging, reviewing and "signing" documents; making mediator proposals and follow-up if a case doesn't settle; and “settlement days” of back-to-back mediations. It is likely we will continue to recognize new benefits of ODR as we expand its use.
Eventually, a more robust measure of online mediation versus in-person will come when the pandemic fades and we return to having a choice between the two. In the meantime, parties to personal-injury cases should be encouraged by the advantages available via online dispute resolution, and should use ODR to maximize the chances for successful outcomes.
From the Indisputably blog. This dispatch comes from Jackie Nolan-Haley (Fordham) discussing Monday’s program Negotiating with the Dangerous headlines by our very own Andrea. On October 5, 2015, the Fordham...By Art Hinshaw