Mandatory arbitration provisions in contracts generally are a huge issue. USAA reportedly “uses mandatory arbitration clauses in many of its financial services contracts with service members.” Jessica Silver-Greenberg and Michael Corkery, “Failed by Law and Courts, Troops Come Home to Repossessions” p. A1, col. 1 (New York Times Nat’l ed., St. Patrick’s Day, 2015). If USAA and perhaps other insurance companies are using mandatory arbitration clauses in financial services contracts, their inclusion in the type of financial services contracts known as insurance contracts seems likely.
If mandatory arbitration provisions in insurance contracts become an accepted part of transacting the business of insurance, it must be remembered that class action waivers are ordinarily a part of mandatory arbitration provisions in contracts in general.
Please Read The Disclaimer. ©2015 by Dennis J. Wall. All rights reserved.