Why is My Harrisburg, PA Car Accident Claim Going to Arbitration?

Most Harrisburg car accident cases are settled outside the courtroom, sometimes through a process called arbitration. Both sides present evidence to an arbitrator, who decides how to resolve the claim. This is a faster, much less expensive way to settle a case.

In the blog below, we explain why your car accident claim may go to arbitration, what the process looks like, how long it may take, along with the pros and cons of this option for resolving a case.

If you are struggling to obtain a fair settlement of your car accident claim, Schmidt Kramer may be able to assist you. Our experienced attorneys have obtained millions in compensation for car crash victims throughout Pennsylvania.

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What is the Definition of Arbitration?

Arbitration is a type of alternative dispute resolution. The parties involved in a dispute, such as a car crash claim, agree to present their cases to a third-party arbitrator instead of going to court. The arbitrator listens to both sides, examines evidence, and decides how to resolve the case. You can think of the arbitrator like a judge.

Arbitration is a faster, less formal, and cheaper option than going to court. The process is also private, which means the details of the dispute and the decision are usually confidential.

How Does Arbitration Differ from Mediation?

While arbitration and mediation are both ways to reach a resolution, they are not the same.

In arbitration, the arbitrator decides how to resolve the case based on the information that both sides present. In mediation, a mediator attempts to facilitate negotiations between both parties. The mediator does not decide the case, his or her goal is to help both parties make a mutually agreeable settlement.

What Are the Two Types of Arbitration?

While arbitration is used in various types of disputes, you can divide this form of dispute resolution into two main categories:

• Binding Arbitration: If the decision is binding, it is final and enforceable by law. The parties must abide by it, and there are limited opportunities to file an appeal. While there are disadvantages to this type of arbitration, it does give the parties more control over the resolution of the case compared to the courtroom.
• Nonbinding Arbitration: If the decision is nonbinding, it serves as a recommendation. Either party can choose to accept or reject it and pursue further legal action if desired. For example, if a court orders arbitration, the arbitrator’s decision may be nonbinding.

How Long Does Arbitration Take for a Car Accident in Harrisburg?

The hearing itself could be just a few hours or it could take several days to complete. It depends on the complexity of the case and the amount of evidence and testimony both sides choose to present. Some cases take several days or even weeks to resolve.

Although some car accident arbitration cases take longer to resolve than others, the process is still more efficient than a courtroom proceeding. This is partly because arbitration is much less formal.

Another factor in the length of an arbitration case is how the arbitrator manages things. You also need to consider how cooperative both parties are.

Why do Some Harrisburg Car Insurance Claims go to Arbitration?

When the victim and his or her attorney and the insurance company cannot reach agreement on a settlement, one side may suggest arbitration. If the other side agrees, they may use arbitration to reach a resolution.

However, there are also times when courts mandate arbitration, such as before starting a jury trial. When this happens, both sides have no choice, they must enter arbitration to attempt to reach a resolution.

What Are the Pros and Cons of Car Accident Arbitration?

Arbitration has many benefits compared to other methods of resolving a Harrisburg auto accident claim:

• Avoiding the added cost of the courtroom
• Arbitration is much faster than a jury trial, which means you receive compensation sooner.
• Arbitration is often confidential, so the details of the dispute are not made public.
• Binding arbitration prevents the other side from appealing the decision, so you do not have to worry about the decision getting overturned later.
• There are relaxed standards of evidence in arbitration, so your lawyer can enter hearsay as evidence.
• Your lawyer can work with the insurance company on a high-low agreement. This is an agreement to the minimum and maximum payment the arbitrator can award. That way you will not receive less than the minimum amount or more than the maximum amount.

However, arbitration is not without its disadvantages. In fact, some of the pros can also be cons:

• Arbitration is private, even though you may want the detail to be public because you want others to learn about the other side’s conduct.
• Nonbinding arbitration allows for appeals, so even if the arbitrator decides the case in a way that favors your interests, the other party could try to have the decision overturned.
• Expert witnesses usually do not testify. Instead, testimony from expert witnessesis presented via written statements. While this information can still be very useful, it may not be as compelling as it would be if the witness was delivering the information verbally, in person.
• Your attorney may not see the insurance company’s evidence until the day of the hearing, as arbitration does not have a discovery process.
• The insurance company may be able to enter hearsay as evidence.

Why do Insurance Companies Choose Arbitration?

Insurance companies would prefer to avoid a lawsuit. Going to court is going to cost them a lot more money and they do not know how the jury is going to rule. The insurance company could end up paying out a lot more in a lawsuit than they would in a settlement.

If settlement negotiations break down, insurers may be willing to go to car insurance arbitration to avoid a lawsuit, especially if:

• There are no car accident witnesses
• No one can locate the witnesses
• Liability is unclear
• There is a lack of compelling evidence
• Each side is accusing the other of causing the crash

Who Gets to Pick the Arbitrator for a Harrisburg Auto Accident Claim?

The selection of an arbitrator is often determined by the terms of the insurance policy, such as in a first-party claim against a Pennsylvania auto insurance policy. Often, both parties choose an arbitrator. These two arbitrators in turn select a third arbitrator to form an arbitration panel.

When arbitration is ordered by a court, the court may provide a list of potential arbitrators. Both sides must agree on an arbitrator from this list.

Who Can be an Arbitrator in a Car Crash Case?

Arbitrators need to be impartial, have in-depth knowledge of the legal issues involved in the case, and be able to objectively interpret the evidence. That is why arbitrators are usually people who have significant experience with these kinds of situations, such as:

• Retired judges
• Experienced lawyers
• Industry experts who have specialized knowledge that is relevant to the case
• Trained arbitrators who have been certified in alternative dispute resolution

What is the Car Accident Arbitration Process in Pennsylvania?

In 2019, Pennsylvania and 20 other states adopted the Revised Uniform Arbitration Act (RUAA) to govern arbitration agreements in the state. This comprehensive law offers guidance on various aspects of arbitration.

The law says the arbitrator or arbitrators will set a time and place for the hearing. Both parties and their lawyers have the right to present evidence and cross-examine witnesses. Arbitrators have the authority to issue subpoenas to witnesses.

In general, they have broad discovery powers to help them determine the facts of a case, much like courts do. For example, arbitrators can issue protective orders, act against parties that are not complying with court orders and set the conditions for taking depositions.

Arbitrators are also required to disclose facts that may affect their impartiality in the case. For example, the arbitrator must disclose personal or financial interests that may be affected by the outcome.

What Happens at the Hearing?

A car insurance arbitration hearing is a structured but less formal process than a court trial, where the parties involved in a dispute present their cases to an arbitrator or a panel of arbitrators. These are the steps that are typically involved:

• Opening Statements: Each party begins with an opening statement. This is where they outline their case, summarizing the facts, legal arguments, and what they intend to prove.
• Presentation of Evidence: After opening statements, the parties present their evidence.
• Cross-Examination: After a witness testifies, the opposing party has the opportunity to cross-examine. This allows them to challenge the testimony or clarify points.
• Questioning by Arbitrators: The arbitrator(s) may ask questions during the hearing to clarify details or seek additional information.
• Closing Statements: Once all evidence has been presented and witnesses have been heard, each party gives a closing statement. This is their final opportunity to summarize their case and argue why the arbitrator should rule in their favor.
• Deliberation and Decision: After the hearing, the arbitrator(s) deliberate privately. They consider all the evidence and arguments before deciding how to resolve the case.
• Issuance of the Award: The arbitrator issues a written decision, known as an arbitration award, which is often binding.

What Evidence Can Your Lawyer Present to an Arbitrator?

There are various kinds of evidence that your lawyer could present at an arbitration hearing:

• Witness Testimony: Oral statements from witnesses, including expert witnesses
• Documents: Contracts, agreements, emails, letters and other written records relevant to the dispute
• Photographs and Videos: Visual evidence, such as pictures of injuries, accident scenes or property damage.
• Medical Records: Documentation of injuries, treatments and medical diagnoses related to the case
• Accident Reports: Police reports, insurance claim reports and any official documentation of the accident
• Expert Reports: Written opinions from experts in fields like accident reconstruction, medical evaluation or financial analysis.
• Physical Evidence: Tangible items relevant to the case, such as damaged vehicle parts or defective products
• Digital Evidence: Emails, text messages, social media posts and other electronic communications
• Financial Records: Bills, invoices, and financial statements that demonstrate economic losses, such as lost wages or repair costs
• Diagrams and Charts: Visual aids that illustrate points, such as accident reconstructions, timelines or financial breakdowns

The arbitrator determines what evidence can be admitted and must determine the weight of the evidence when rendering a decision.

If you are wondering whether arbitration may be a good option, you should discuss things with an experienced lawyer. Insurance companies cannot require you to go through arbitration. You must agree to use arbitration instead of negotiating a settlement or going to court.

Frequently Asked Questions About Arbitration of a Car Accident Claim in Harrisburg

These are some of the questions crash victims frequently ask about auto accident arbitration:

Can I Prepare for Arbitration Like a Trial?

Yes, you can prepare similarly by gathering evidence and preparing witnesses, though the format may differ. However, your lawyer is the one who will be preparing for the hearing. He or she can advise you on what you need to know and what to expect.

What Should I Expect at My Arbitration Hearing?

Your lawyer’s goal is to present a compelling case in support of your interests. Both sides will present their cases and you may be called on to testify. This is something your lawyer can prepare you for.

What If I Disagree with the Arbitrator’s Decision?

If arbitration is binding, challenging the decision is difficult. For nonbinding arbitration, you may have the option to negotiate further or go to court.

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