An alternative dispute resolution clause is a clause in professional liability policies that states that disputes relating to the application of insurance coverage under a policy will be resolved through alternative dispute resolution (ADR) approaches (typically arbitration) rather than through traditional litigation. system. Some policies contain mandatory arbitration clauses that state that disputes must be resolved in this way. In contrast, other provisions of ADR provide the policyholder with the option, but not the obligation, to submit such disputes to arbitration. The latter version of this provision is more beneficial for the insured.