What is a Nuclear Verdict and How can you Avoid it?

Nuclear verdicts happen when a claim goes to trial and a large and unexpected financial penalty is awarded, usually over $10 million. Plaintiff attorneys are successful in getting juries to award these large sums by playing into fear, sympathy and the hope similar incidents will be prevented because of it.  Not only are the financial penalties steep, nuclear verdicts also cause insurance renewals to see significant premium increases.

Nuclear verdicts are most frequent in product liability (23.6% of the total), auto accident (22.8%), and medical liability (20.6%) cases.*  According to the American Transportation and Research Institute (ATRI), the average size verdict for a trucking company is $22,288,000, a 967% increase from 2010 to 2018.  If a child is involved in an accident, the verdict amount increased and average of 1600% regardless of who is at fault (ATRI).

Nuclear verdicts in many cases are lose-lose situations, meaning no amount of money is going to change the outcome of an accident and the verdicts cause significant trouble for the insurance market. Often a claim that results in a nuclear verdict is preventable.  The most effective strategy to avoid claims that result in nuclear verdicts is to have a safety and risk management program in place that includes best practices and proactive claims management. Engaging a safety consultant to review your current plans to identify risks can reduce the number of work-site accidents and the number of claims that have the potential of going to trial.

For a deeper dive check out the report here or contact us for more information.

*Nuclear Verdicts: Trends, Causes, and Solutions – ILR (instituteforlegalreform.com)

ABOUT THE AUTHOR

Jamie Glanz

Jamie Glanz is the Senior Vice President of Claims at Assurance. With more than 20 years’ experience, Jamie is an expert in mitigating third party claims by reducing claim duration and incurred expenses. Throughout her career, she has managed claims across multiple lines of coverage and industries, including construction, governmental agencies, healthcare, manufacturing, and retail. As Senior Vice President, Jamie is responsible for providing leadership and oversight to Assurance’s Claims Team to ensure the flawless execution of our service platform. She has a Bachelor of Science degree in Occupational Safety and Senior Claims Law Associate designation. She was named Assurance’s 2010 Employee of the Year.