Your First International Arbitration: Do’s and Don’ts What’s Wrong with Arbitration?

When it comes to fairness in modern U.S. insurance and reinsurance arbitrations (hereafter “insurance arbitrations”), perception is arguably as important as reality. If the parties do not perceive the process to be fair, they will not embrace arbitration as an alternative to litigation regardless of whether it is cheaper or faster. Central to the parties’ perception of fairness is the composition and behavior of the arbitral panel, which is typically “tripartite” in nature, being comprised of two party-appointed arbitrators and one umpire. Absent a provision to the contrary in the arbitration agreement, the two party-appointed arbitrators are generally presumed to be “non-neutral”, while the umpire is required to be completely neutral and impartial. Understandably, the parties to insurance arbitrations will from the outset be acutely concerned with any economic or personal factors which might influence any of these three arbitrators, especially the umpire.