Insurers as Contract Influencers

October 24, 2024, 4 - 5 p.m.
Rick Swedloff, Rutgers Law School
Contract boilerplate degrading consumers’ litigation options-terms mandating arbitration, exculpating liability, requiring individualized litigation and shifting risk-has proliferated in the last generation. We investigate how insurers influence boilerplate’s adoption and content. Interviewing participants in the liability insurance industry, we show that insurers refine boilerplate language, teach policyholders about its efficacy, and decline coverage when it is absent. At the same time, they rarely offer price breaks for adopting boilerplate, suggesting that at least some of the cost savings from consumer boilerplate may end up in the coffers of insurance firms rather than their clients. Insurers are surprisingly skeptical about the value of terms that have particularly excited proceduralists and consumer contract scholars-arbitration and liability waiver clauses-and believe their spread does not materially affect the risks that they insure.
Recommended Reading: David A. Hoffman and Rick Swedloff, Insurers as Contract Influencers (July 29, 2024).