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When you go to court and need a witness with specialized knowledge, the process of figuring out who fits the complex legal definition of an expert might leave you wondering, Who am I gonna call?

Knowing what qualifications to look for is key to finding a qualified “industry expert” whose evidence the courts will accept.

Looking at the legal history of such testimony, one can see that this is no easy task, for what constitutes an expert is an area where the standards have been evolving and are anything but clear-cut.

According to the most current definition in Websters dictionary, an expert is one who has acquired special skills in, or knowledge of, a particular subject. And, in 1923, in the Frye v. United States case, the U.S. Circuit Court for the District of Columbia established a standard for the admission of expert witness testimony in cases brought before the federal court. The Frye standard required that the data and methodology used by the expert in developing their opinion must be of the kind that is “generally accepted” by other practitioners in that specific discipline.

In 1975, Congress enacted Federal Rule of Evidence 702, which states: “If scientific, technical, or other specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue, a witness qualified as an expert by knowledge, skill, experience, training, or education may testify thereto in the form of an opinion or otherwise.”

Rule of Evidence 702, however, did not directly address the legal standard for establishing the foundation of an experts conclusions. The “generally accepted” standard established in Frye continued to be used until 1993, when the U.S. Supreme Court issued its opinion in Daubert v. Merrill-Dow Pharmaceuticals. The high court found that Rule 702 abolished the Frye “generally accepted” standards and that the federal courts must now apply a new standard for the admission of expert testimony.

Under Daubert, a two-step analysis was established to be used by the federal district courts relating to scientific evidence and expert testimony–(1) the evidence is relevant, and (2) it is reliable.

The reliability is measured against a four-part test:

Can the theory or technique be tested?

Has it been subjected to peer review and publication?

Is there a known or potential rate of error?

Is there a level of general acceptance in that particular disciplines community?

While Daubert dealt specifically with scientific experts, many courts have held that the “gatekeeper” function of judges discussed in Daubert applies to all types of expert testimony under Rule 702, and the trial judge must find that expert witness testimony is both reliable and relevant.

In the Broders v. Heise case, the Texas Supreme Court held that: “What is required is that the offering party establish that the expert has knowledge, skill, experience, training or education regarding the specific issue before the court which would qualify the expert to give an opinion on that particular subject.”

Since it appears that many courts accept the testimony of a qualified “industry expert,” what qualifications should we seek? What “skill sets” would lend value to the defense or prosecution of the position?

It is well known that underwriters, marketers and claim adjusters seldom exchange ideas or discuss risks before new coverage is developed or a policy is written. It is, therefore, not unexpected that there will be losses presented that were not expected when the coverage was written. Disagreements will inevitably occur when there is a question as to whether a specific loss is covered.

While the underwriter establishes the underwriting intent, it is the claims department that interrupts the coverage and decides whether a specific loss is covered.

Further, with the ever-changing world of litigation, plaintiff attorneys are constantly developing new areas of pursuit in efforts to find coverage where it was not thought to be before. The insurance industry itself contributes to these areas of dispute by not having consistent and universal standards regarding policy language, underwriting practices and claims handling procedures.

As required by Daubert and previously by Frye, an expert must have experience that is “generally accepted” in the industry. But in an industry that does not have universally accepted standards, how does one determine what is generally accepted?

Among attorneys who specialize in coverage litigation, I have found that while work experience, education and industry recognition are important, the ability to think out-of-the-box and to assist in the general direction of the case is just as important in selecting an expert.

Since they need someone to successfully advance their position in front of the court, attorneys usually want someone with a breadth of experience that will allow them to assist in other aspects of the case.

If the dispute involves alleged improper claims-handling practices, the selected expert should be able to draw upon their industry experience such that the experience reflects industry practices, not just the practices of one insurance company.

Also, specific standards may vary, depending on the exact nature of the dispute. An example would be if the dispute were between a reinsurer and a ceding company. The reinsurance treaty may contain a “Follow the Fortunes” clause, which restricts the ability of the reinsurer to question claims decisions, which might otherwise seem inappropriate.

Another example might involve alleged breach of performance standards included in a service contract with a third-party administrator. The selected expert should understand these various nuances and be able to assist in the general direction of the position being advanced.

In a somewhat similar vein, the expert should also be able to interpret coverage and how it would apply in the particular instance. Experienced claims professionals usually view application of coverage relating to a specific claim from a certain perspective, which may not be obvious to someone who hasnt handled claims. There is no real substitute for experience gained by working in the industry.

An experienced attorney can use this knowledge to strengthen his position or create alternative positions to further his argument.

I personally have found that, when I have been involved in cases where I was able to make recommendations based on my experience, my advice strengthened existing arguments or led to the use of a different position that helped the clients case.

Another concern in the area of expert witnesses relates to the number of times they have given expert testimony.

Most attorneys do not want a “professional” expert. They would rather have someone who is either still working in the industry, or at least derives less that 25% of their income from providing expert testimony.

Additionally, the more times someone has testified, the larger the risk that something in a deposition or trial transcript could be used against them. However, prior trial experience is still desirable, since the expert should have testifying experience and be able to handle the pressure of an intense cross-examination.

Now that you know what to look for, where do you look?

There are a variety of industry sources that maintain databases of expert witnesses categorized by specialty. The Martindale Hubble lawyers directory, put together in New Providence, N.J. (see www.Martindale.com); the Technical Advisory Service for Attorneys in Blue Bell, Pa. (www.TASAnet.com); and the Defense Research Institute in Chicago (www.DRI.org), to name a few.

Another possibility is an Internet search by specialty to identify authors or speakers on specific subjects. However, the preferred manner to identify a specific subject matter expert, based on my research, is by either a referral or networking within the industry.

Many senior insurance executives, be it claims, underwriting, risk management or other specialty, maintain an extensive industry network. The insurance brokerage and consulting community likewise tend to network effectively, and are usually willing to openly discuss potential candidates to represent various positions.

In summary, the “preferred expert” should have testified before and gained significant industry knowledge as a result of exposure to different approaches to addressing the specific issues in question.

The individual should have achieved recognition within the industry, probably obtaining industry designations and/or licensing, and have written about the issue involved. He or she should also have the ability to “think on their feet” and handle themselves under strong cross-examination. An associate should provide a name, or someone you respect should refer them.

is an independent consultant based in Westmont, Ill., who provides advice for claims-related projects and expert support in policyholder disputes. He can be reached at WJBerglund@aol.com.

Most insurer attorneys do not want a “professional” expert. They would rather have someone who is either still working in the industry, or at least derives less that 25% of their income from providing expert testimony.


Reproduced from National Underwriter Life & Health/Financial Services Edition, November 4, 2002. Copyright 2002 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.