If you stay in business long enough, you’re definitely going to realize that you can’t please everybody. Disputes are bound to happen.

Most of the conflicts you have with your customers or clients will probably be resolved pretty quickly. What happens, however, when someone angrily announces that they’re going to sue?

Don’t panic. You may still be able to diffuse the situation

Most threats are made in the heat of the moment. That means you still have a chance at resolving things.

Try to identify what the customer really wants out of the situation. It may be cheaper, easier and less stressful, for example, to give a customer an unwarranted refund than deal with the disruption to your business.

You should also try to put yourself in the customer’s shoes. Is their complaint legitimate? If so, what would you expect (or want) in their situation? If their complaint is valid, it may be to your advantage (financially and for the sake of your reputation) to settle quickly.

Inform your insurance provider that you may have a problem

You need to know if your business insurance covers the specific problem you have with this customer. There are many types of business insurance. If the client alleges a true loss because of some mistake you made, you may need to turn to your professional liability policy. If there’s a slip-and-fall allegation from a customer, you may need to look at your general liability policy, instead.

Knowing exactly what your insurance will cover, if you have to fight or settle a claim can help ease your anxiety and provide some clarity of direction.

Finally, make sure that you seek appropriate legal guidance as soon as possible. Even if the unhappy customer seems to be mollified when they finally walk out your door, trouble could still be brewing. It’s best to be ready.