What is the relationship between claims made and litigations settled?

The relationship between claims made and litigations settled is best represented by the understanding that most claims are settled without entering the litigation process. In many cases, insurance claims can be resolved through negotiation and mediation, allowing both parties to agree on a settlement without the need for formal legal proceedings. This process is generally more efficient, cost-effective, and timely, benefiting both claimants and insurers.

Litigation can be a lengthy and expensive process, which often discourages both parties from pursuing this route unless absolutely necessary. Many insurers have claims handling procedures in place that encourage settlement prior to litigation, fostering a collaborative approach to resolving disputes. This highlights the practical realities of the insurance claims process, where the majority of claims are resolved at earlier stages, thus ensuring that most claims do not end in litigation.