Cost per matter divides total defense expense by the number of matters within a defined segment, typically by matter type, firm, or jurisdiction. It may include or exclude vendor and expert costs.
It is usually reported alongside indemnity outcomes to assess overall claim cost.
Alternative Names:
Average Cost Per Matter, Per-Matter Spend
Why it Matters?
The metric is only meaningful when segmented, since averaging routine claims with severity matters produces a number that describes nothing. Comparing firms requires matching case mix, jurisdiction, and disposition type, and clients that do not normalize penalize firms handling harder work. Where the analysis is done well it identifies genuine outliers, including matters where cumulative defense spend has exceeded any plausible indemnity exposure.
Frequently Confused with
Related terms
Frequently asked questions
What makes cost per matter comparisons fair?
What does the metric usefully reveal?
