I was told I’m going to have to go to mediation. What is it, and what can I expect?
Sinkhole claims are often resolved in mediation. Mediation is a form of alternative dispute resolution – that is, a method of resolving a dispute that is an alternative to litigation. The parties to a dispute meet face-to-face and attempt to reach a compromise to settle the dispute. Insurance claims may be mediated by agreement prior to the filing of a lawsuit, although that is unusual. Typically, claims are mediated after a lawsuit is filed, and, in fact, courts require each case to go through mediation before trial.
A mediator who is specially trained in helping parties reach settlement agreements presides over the mediation conference. (Many mediators are former judges.) The mediator begins the mediation by describing the process to the parties. Then each of the parties, or their attorneys, describes their position in an opening statement. The Plaintiff or claimant usually includes a settlement demand in their opening statement. The parties go to separate rooms so that they can discuss their positions with their attorneys. The mediator conveys settlement offers between the parties until either a settlement is reached or it is determined that there is no possibility of settling the matter (referred to as an impasse).
Some insurance companies prefer to mediate claims early in the litigation process, while others prefer to wait until a later stage when discovery is complete. Either way, mediation usually offers the greatest chance of resolving a claim or lawsuit prior to trial.
Any settlement reached at mediation is entirely voluntary. The mediator cannot force any party to make a settlement demand or offer and cannot force any party to accept the other party’s demand or offer. One of the most significant characteristics of mediation is that everything said in mediation is confidential. That is, nothing that is said at mediation by any party may later be used in court. This makes mediation the only time in the litigation process where the parties can communicate freely with each other, making it more likely that a case will settle at mediation than at any other time.
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