The Institutes

Mandatory Auto Arbitration

 Friday, July 2, 2021

 Matthiesen, Wickert & Lehrer, S.C.

When one insurance company subrogates against another insurance company and both are members of intercompany arbitration, such as Arbitration Forums, arbitration is mandatory.

It is the type of damages sought that determines whether arbitration is compulsory, not the type of coverage afforded by the Respondent. The type of liability coverage afforded by the Respondent is irrelevant.

For example, when a vehicle sustains damage at a car wash and both the liability carrier for the car wash and the personal auto insurer for the damaged vehicle are members of arbitration, they must arbitrate the subrogation claim.

A Respondent could be an auto liability insurer, a homeowner’s liability, a general liability carrier, or a products liability carrier. If the carrier is signatory to auto arbitration, arbitration is still mandatory.

What about auto arbitration when one of the carriers involved is not a member of arbitration?