Litigation arising from liability or workers’ compensation claims can put enormous strain on company resources, disrupt daily operations and harm an organisation’s reputation.
However, risk managers and financial officers can do far more than they often realise to prevent claims from turning into full-scale lawsuits. The cost of litigation funding can be ruinously high, but with early action, open dialogue and smart use of technologies such as artificial intelligence, the path to resolution can be faster, cheaper and considerably less disruptive.
With the increasing range of funding options provided by many specialist firms, such as https://www.novo-modo.co.uk/litigation-funding, litigation is often considered a last resort, but sometimes there is no choice. If a business is contemplating litigation, it is important to dispel the most common misconceptions.
Legal action is inevitable
This is rarely true. Most conflicts can be resolved before they escalate.
Insurance will cover it
In fact, exclusions and limits can render insurance only partially effective, while reputational damage often falls outside the scope of a policy.
Safety protocols guarantee protection
Robust safety procedures will not always prevent workers’ compensation claims. How incidents are managed afterwards matters just as much.
A quick settlement ends it
It’s tempting to believe that settling quickly avoids trouble, but rushed deals without full investigation can risk future disputes.
Alternative Dispute Resolution is the answer.
While ADR can be effective, it isn’t a cure-all. Poorly managed mediation can still cause delays and costs.
Debunking these myths enables organisations to manage both risk and litigation more effectively.
