Acting as an expert underwriting witness, either in legal actions or arbitration processes, can be interesting work. Usually, such cases arise through policyholders being dissatisfied with non-payment of claims, but sometimes it is the insurer which is the aggrieved party, maybe suing a distributor or a service provider. What follows is based on our experience of acting as an expert witness, and thus reflects the British (and Irish) legal systems, but the principles are likely applicable elsewhere too.
In the UK and Ireland there is an insurance and financial services ombudsman respectively, and thus the cases that go to law, and which may require the services of an expert witness, are those that are outside the ombudsman’s remit or in which the ombudsman has arrived, in the plaintiff’s view, at the ‘wrong’ decision.
An expert witness needs to set out their credentials in order to reassure the court that they are an expert in their field. In the realm of life and disability underwriting it helps to be able to cite qualifications and experience beyond the mere assessment of risks in addition to however many years one has had in the role. Not that duration of service is unimportant: on occasion an element of the case may revolve around usual underwriting practice in the market at the time the policy was effected, which may have been some years back.
Sound knowledge of law relating to disclosure and the duties of applicants and intermediaries is vital. So is knowledge of market regulations that were applicable at the time. And the expert witness needs to know what official standards apply to the structure and wording of their report, such as required declarations that need to be included.
Mindset is important. The expert witness needs to look at things from the point of view of a ‘prudent underwriter’. So, when considering what would have been a reasonable underwriting decision based on the evidence available at the time, what answer would the prudent underwriter have come up with? Similarly, in cases of non-disclosure of material facts, if the relevant information had been disclosed, what information would the prudent underwriter have called for and what would have been their final decision?
While the circumstances of a case might be interesting, the review of the supporting papers – which usually run into hundreds of pages – can be tedious, with duplication and many documents that do not bear on the issues in question. Nevertheless, the expert witness needs to sift through the file methodically and forensically in order to identify every factor, however small, that has a bearing on the matters at hand. All these need to go into the report which presents the expert’s opinion and the basis of it.
And the report – the expert witness’s statement – needs to be thorough and lucid, setting out in detail all the facts, the principles involved, the arguments arising and, in his or her opinion, how that prudent underwriter would have viewed the situation and what his or her underwriting decision would have been.
In all this it is important to understand that the duty of the expert witness is to the court of law. Despite being chosen by one of the parties to the action, he or she but must remain impartial in all assessment and opinion-forming. Favouring the party that selected you is absolutely out of the question. (Once, we were engaged by an insurer which was defending an action regarding denial of a disability insurance claim, but reached the opinion that the plaintiff had not failed to disclose material facts; there was a significant health history but the application form questions were such that it did not require disclosure. We spoke as we found…)
This does not mean that expert witnesses inevitably reach the same conclusions. The expert for the ‘other side’ might have a different view on things. And sometimes the other side’s expert simply lacks the necessary experience and thus, as well as lacking credibility, fails to appreciate the key issues.
But acting as an expert witness is not just about preparing a written statement for the court. Cases do go to trial, probably involving the expert to be called to the witness box to be examined and cross-examined by the counsel for each party. In our experience though, few cases get that far: either the plaintiff loses heart in the face of evidence against them (including from the other side’s expert witness), or a settlement is made out of court.
On one occasion a case was due to go to trial in Dublin. We were by the departure gate waiting for our flight when a call came telling us to go back home: at the last minute the case had been settled or the action withdrawn. Sometimes nerve breaks at the last minute.