Insurance Company In-House Counsel

Michael Sean Quinn, Ph.D, J.D., C.P.C.U., Etc.

2630 Exposition Blvd  #115

Austin, Texas 78703

(o) 512-296-2594

(c) 512-656-9759

mquinn@msqlaw.com

(Resumes at  www.michaelseanquinn.com)

This blog entry is really about in-house legal departments at insurance companies, as the reader will see presently. The focus on insurance has a general point behind it about a general trend--still relatively small--toward more creation and use of legal departments.

In the last several years approximately 50-58%  of larger companies have moved legal work in-house.  This might be as much as $6.9B according to WSJ September 15, 2014.  Granted this is only a small fraction of the $100B+ corporations will spend on legal fees this year. Still, “[c]orporate law departments also are tackling increasingly complex matters that were once the province of major law firms. Some are hiring seasoned attorneys with pedigrees from bit law firms to come work inside companies, where they advise on everything from mergers and acquisitions to advertising rules and antitrust matters.” See B6.

Why? Lower cost? Obviously. Supervising the brigades contract lawyers hired by the companies? WSJ says so, and the brigades will grow to divisions or armies in the next decades, if the trend continues. Shorter hours: Maybe. Room to rise? Wouldn’t be surprised. Less management? Bet so. More flexible time off? Don’t know. Easier access to corporate meetings in exotic places? Possible. Cyber based research tools? I wonder.  All of the above? Virtual certainty.

            As disappointed as I am to have to admit this, Richard Susskind, one of the world’s leading egotistical narcissists—not far behind Ralph Lauren--if his marketing ploys are any indication, turns out to be right about this. This will become “more true” if the trend continues.  Myself, I’m convinced that it will. (With regard to Susskind, I can still say that his current book, TOMORROW'S LAWYERS: AN INTRODUCTION TO YOU FUTURE (Oxford U.P. 2003) erroneously says a number of condescending and false things about in-house lawyers of previous and current generations.)

            I observe insurance the insurance industry to fairly large degree, and I have wondered why this tendency doesn’t get stronger and stronger.  This happens pretty much big time with many, many smaller cases, but I can’t understand why it isn’t happening big time for virtually all cases. I wonder if the defense firms they use now aren’t just as cheap as a large in-house litigation department might be. Perhaps because big insurer legal departments are located in one or only a few places.  If the defense lawyers they use were in-house maybe travel expenses would go up, even if nothing else did. However, this observation does not apply to coverage counsel.