The National Arbitration Forum Blog

Thanks to Michael Moffitt for pointing out an interesting article by University of Minnesota Law School Professor Daniel Schwarcz. According to the abstract for Toward a New Approach to Resolving Consumer Insurance Disputes:

"Litigation is often too slow and costly for those who have recently suffered significant financial loss. Meanwhile, the alternative dispute resolution options that do exist - such as the mediation services that insurance regulators offer or the existing variants of insurance arbitration - are generally either ineffective or unavailable for most disputes."

In his article, Schwarcz looks at a United Kingdom program that has seen success. The Financial Ombudsman Service (FOS) is a statutory, informal dispute resolution service, operating as an alternative to the civil courts. The service boasts many similarities to private arbitration in order to facilitate the resolution of disputes between consumers and businesses quickly and with minimum formality. The UK program operates in three jurisdictions (compulsory, consumer credit and voluntary) covering the financial services landscape.

According to Schwarcz, the key to the program’s success is that "the FOS combines the individual and non-coordinated ADR reforms that are used in America into a single, unified process."