People often think of just two options for solving a personal injury dispute with an insurance company: a settlement or a jury verdict. There are a few other ways the dispute may be settled, such as arbitration.
Arbitration is a form of Alternative Dispute Resolution (ADR) and is used to resolve a dispute outside of the courtroom before an arbitrator. An arbitrator is an objective third party brought in to help create an agreement between both parties.
When arbitration is voluntary, both parties have agreed to resolve their dispute in this manner. Some people may choose to take a case to arbitration because it allows both parties to pick the arbitrator with expertise and knowledge in the case being disputed.
Mandatory arbitration generally occurs because of a clause in an insurance contract. Arbitration could also be mandatory if a judge orders a case to be resolved by an arbitrator.
Before taking a dispute before an arbitrator, both parties must agree whether the decision is binding or non-binding.
Binding arbitration means the decision is final and cannot be appealed or disputed any further. Non-binding arbitration allows room for continued dispute and potentially going to court.
Just like taking a claim to court, arbitration has its own advantages and disadvantages. Some of the advantages to arbitrating a personal injury claim include:
Some of the drawbacks of deciding a case through arbitration include:
Most car accident claims are settled by insurance companies outside of the courtroom. However, there may be times when a claim may need to be resolved by an objective third party and paying an arbitrator may be cheaper than having to take the claim to court.
Considering the time it would take to file a lawsuit, get a court date, have a judge assigned to the case and find a jury, your attorney and the attorneys for the insurance company may come to the agreement that arbitration would work better.
If you have additional questions about arbitration or filing an insurance claim, the car accident lawyers in Sacramento from our firm are prepared to answer them. We offer a free consultation with no obligation to take legal action.
Call us today at (916) 777-7777