Within legal departments today, the most common barriers to obtaining knowledgeable outside counsel for non-litigated matters are cost and uncertainty. Outside counsel is seen nowdays as an expense which must be scrutinized, limited and reduced. But there are ways to enjoy the benefit of the independent, objective opinion of outside counsel without worrying that doing so is an unnecessary extravagance, or yet another trip down the black hole of a running meter.
The truth is that most non-litigated matters handled for insurance company legal departments don’t need to be handled via hourly rate. Costing such projects is easy and predictable. And the legal marketplace no longer operates under a single, monolithic pricing model. Good lawyers are available for reasonable, flexible, affordable fees.
Coverage opinions and claims file audits can be performed by experienced outside counsel via fixed fee, quoted arrangements. A legal department can get the benefit of a coverage opinion or claims file review for a low, fixed sum, quoted after only a brief review of the scope of the matter. This small investment in an outside opinion can save an insurer many multiples of the fixed fee cost in coverage or extra-contractual exposure later on. There are even more savings available with volume discounts or “block” fee quoting for multiple non-litigated matters. The options are virtually endless.
Traditionally, the return on investment which a coverage opinion or claims file audit brought was not sufficiently predictable: the hourly rate arrangement made the initial investment in an outside opinion unclear, and therefore made the benefit hard to measure. Under a fixed-fee arrangement, six and seven figure exposures can be identified and prevented with small four figure investments.
For more information on providing your legal department the large investment return on fixed fee coverage opinions and claims file audits, reach me at firstname.lastname@example.org or 717-731-4800.