Lex Machina Launches Legal Analytics Module for Insurance Litigators

The solution provides data analysis to illuminate decision-making elements, such as case timing, resolutions, damages, and track records of opposing counsel, parties, and judges.

(Image source: Lex Machina homepage.)

Lex Machina (Menlo Park, Calif.), a LexisNexis (Atlanta) company, has expanded its Legal Analytics platform to cover insurance litigation. The vendor’s new module encompasses more than 92,200 cases pending in federal court since 2009 that involve disputes between an insurer and a policyholder, a beneficiary, or another insurer asserting the rights of a policyholder. Insurance cases represent the third-largest case set on the Legal Analytics platform, with court-awarded damages totaling nearly $2.8 billion.

Owen Byrd, General Counsel and Chief Evangelist, Lex Machina.

The Insurance Litigation module provides data-driven insights and trends to help litigators successfully prepare case strategies, and counsel their clients, according to the vendor. It covers a broad spectrum of policy types, including homeowners, automobile, life, commercial liability, professional liability, uninsured/underinsured motorists, health, disability income, and many more, with the exception of Medicare, Social Security and ERISA claims. The module focuses solely on insurance cases (including class actions) that were litigated in Federal District Court, in which parties that reside in different states dispute claims involving more than $75,000.

As part of the product development process, Lex Machina reports that it interviewed experienced insurance litigators and insurance industry insiders to better understand the intricacies of insurance litigation and incorporated their feedback directly into the new module. As a result, Lex Machina has added 50 insurance case tags and annotations that enable attorneys to focus on the most relevant cases and filter out others—such as hurricane-related cases—that could skew the results. The new module illuminates the track records of opposing counsel and parties in these cases, the experience and behaviors of judges, and other critical factors, such as case timing, findings and damages, which play a critical role in determining case strategy, the vendor says.

Accurate and Compelling Data

“Whether you’re battling against an entrenched and well-capitalized insurance company or defending against a steady stream of litigation, Legal Analytics provides insurance litigators with critical insights that help them identify potential outcomes and make data-driven decisions,” comments Owen Byrd, General Counsel and Chief Evangelist, Lex Machina. “Having accurate and compelling data on case timing, resolutions, damages, judicial behaviors, and the opposition’s track record, enables attorneys to counsel clients on whether it would be more beneficial to settle quickly or dig in for a potentially protracted lawsuit.”

Legal Analytics for Insurance Litigation lets attorneys see all federal insurance cases in one place to help them prepare for cases—including those outside their familiar jurisdiction, according to a Lex Machina statement. Using the case tags and filters, attorneys are able to drill down into Lex Machina’s data to answer specific insurance litigation questions such as: “In which cases did insurers win in California because they had no duty to indemnify?” or “How often have claimants won a case because the insurer acted in bad faith?” The vendor asserts that Legal Analytics is the only platform that incorporates these filters into its offering.

Among the fifty new insurance-related case tags added to Legal Analytics are the following, according to the vendor:

  • Forty-two new Findings, including: Duty to Defend, Duty to Indemnify, Bad Faith, Insurer Negligence, Policy Exclusion, Failure to Pay Premium, Insured Fraud, Unjust Enrichment, Estoppel/ Waiver and more
  • Seven insurance damage types: Contract Damages, Restitution, Tort Damages, Emotional Distress Damages, Enhanced Damages, Punitive Damages and Approved Class Action Settlement
  • Two Insurance Remedies: Rescission and Reformation

With the launch of its insurance module, Lex Machina reports that it has already uncovered interesting historical insights into insurance litigation, including:

  • There are 15,691 cases involving insurance claims for damage caused by hurricanes; 14,459 of these cases are terminated.
  • 73% of Federal insurance cases that have terminated settled before trial. The median time to summary judgment of all terminated insurance cases was 429 days.
  • Summary Judgment was granted to claim defendants in 7% of terminated cases and to claimants in 2% of terminated cases.
  • In cases that had a trial, claimants and claim defendants each won about 1% of the time.
  • The Eastern District of Louisiana has seen the most insurance cases overall (7,527 cases, or 8%); however, when hurricane-related cases are removed, E.D. La. drops out of the top five (1,124 cases or 1.2%).

Digital Transformation Requires a Transformation of the RFP Process

Anthony R. O’Donnell // Anthony O'Donnell is Executive Editor of Insurance Innovation Reporter. For over a decade he has been an observer and commentator on the use of information technology in the insurance industry, following industry trends and writing about the use of IT across all sectors of the insurance industry. He can be reached at AnthODonnell@IIReporter.com or (503) 936-2803.

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