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What is mandatory arbitration?

UPDATED: February 20, 2013

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Some states, and many insurance companies, require auto accident disputes to be resolved first through arbitration, rather than litigation. In these situations, liability for damages must be determined as a result of an arbitration process before a civil lawsuit can be filed in the court system. In arbitration, neutral arbitrators (often knowledgeable practicing attorneys) are selected and evidence is presented.

The arbitrators then determine the amount of the arbitration award, if any. If the arbitration award is agreed to, that is the end of the matter (and often the arbitration award is made a final court judgment). If one of the litigants refuses to accept the arbitration award, a lawsuit may then be filed to have a "trial de novo" (new trial) in a court of law, with liability to be determined by a judge or jury.

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