The American legal system strives to create a level playing field that is fair for the victim and the defendant in personal injury and wrongful death cases. Tort liability laws are meant to provide financial compensation for damages where the defendant is guilty of negligence or misconduct. Since some people bring lawsuits when there is little to no damages, the court's goal is to also disallow frivolous suits, especially for claims where the plaintiff hopes to get a quick out-of-court settlement for a weak case.
Liability insurance is intended for individuals and businesses to protect their assets in cases where a wrong or reckless action causes harm to another person. To present a lawsuit, a victim's injury claim is documented by a personal injury attorney to be heard in a civil court. However, as a preliminary step, the plaintiff's lawyer will attempt to negotiate a settlement with the defendant's insurance carrier, which would allow both parties to avoid a formal hearing. Court-mandated mediation is a form of alternative dispute resolution that has become very popular with civil courts when a negotiated settlement is not reached.
The plaintiff and defendant can also choose to enter into mediation prior to a judge's order. Either way, a mediator will work with both parties to obtain a satisfactory out-of-court solution. Mediators can come from a variety of backgrounds but are usually attorneys with special training in collaborative law. Anytime a serious personal injury or wrongful death claim ends up in mediation, it is important to understand the differences in motivation for the victim and the defendant's attorneys.
Insurance companies have no personal interest in a claim other than their need to settle the case for as little money as possible. The physical costs of defending a claim is of little concern, so their pre-trial offer is based on a risk analysis of probable outcomes and their determination as to what the jury might award. As a critical component, the carrier's lawyers will consider how effective the defendant's lawyer has previously been in court. Whether it is fair or not, the insurance company will be more motivated to settle a claim when the victim's lawyer is an accomplished litigator; if not, the defense's settlement offer may go down.