LEGAL & DISPUTE RESOLUTION
Alternative dispute resolution (ADR) definition
Alternative dispute resolution is a legal process in insurance that resolves disputes through methods such as arbitration, mediation or conciliation rather thanor conciliation instead of litigation.,
In practice, this means a term encompassing various methods of resolving legal disputes other than through litigation. Such methods include arbitration, conciliation, mediation and adjudication, with arbitration most commonly adopted. This gives insurers, brokers, reinsurers and risk managers a shared way to discuss the concept when reviewing policies, claims, regulation or market data.
This term is especially useful in insurance market analysis, policy wording and risk transfer decisions. It helps users interpret insurance terminology consistently across markets, policies and risk data. It also helps users compare how insurance is structured, regulated, priced or claimed across different markets.
Alternative dispute resolution (ADR) is closely related to arbitration, mediation, claims and litigation. Linking these concepts together helps build a clearer glossary structure and gives readers a stronger understanding of how individual insurance terms connect within wider international insurance practice.
At a glance
- Used in
- Insurance market analysis, policy wording and risk transfer decisions.
- Purpose
- Helps users interpret insurance terminology consistently across markets, policies and risk data.
- Important because
- Clear definitions support better comparison of insurance products, market practices and regulatory requirements across jurisdictions.
- Related terms
- arbitration, mediation, claims and litigation.
Example of alternative dispute resolution (adr) in insurance
An insured and insurer disagree over the value of a claim. Instead of going straight to court, they use an alternative dispute resolution process to try to resolve the dispute more efficiently.