When our personal injury lawyers meet with crash survivors and other victims of negligence, most of them have questions about insurance settlements. It’s no surprise that people are curious about the negotiation process and settlement values. After a crash, most victims want to rebuild and gain closure, and a settlement often represents the end of their insurance claim.
In this article, our experienced injury attorneys outline some of the most frequently asked questions about settlements. And we’ll give you answers in plain English.
What Is a Settlement?
When you settle an insurance claim or lawsuit, you accept a sum of money. In exchange, you give up your right to any other compensation. The at-fault party and their insurance company don’t admit to any wrongdoing; instead, they are simply offering you money to make your claim go away.
There are two common forms of settlements:
- Lump-sum: You receive a single settlement payment shortly after you and the insurance company come to an agreement
- Structured: You get scheduled payments over time, which can vary in size and frequency depending on the terms of your settlement
No matter how your settlement is structured, one thing is almost always certain: once you finalize a settlement, you can’t go back and demand more compensation or reopen your claim.
What Does an Insurance Adjuster Do?
Claims adjusters are insurance company employees who process and evaluate claims. Their job is to minimize the company’s expenses, not to issue payments quickly and fairly. Adjusters minimize expenses by looking for any potential issue or weakness in your claim: inconsistent medical records, damaging statements, legal technicalities.
Unfortunately, many insurance adjusters will try to get accident victims to make mistakes or accept low settlement offers. Look out for the following tactics if you’re trying to handle an insurance claim on your own:
- Recorded statements: If you’re unrepresented, the adjuster may pressure you to make a recorded statement. Then, the adjuster will try to get vague, misleading, or inaccurate statements, often asking leading questions about your injuries, symptoms, and the facts surrounding the crash or incident. The adjuster will use this information against you later on. To protect yourself, it’s in your best interest to consult a lawyer before you agree to make any written or recorded statements.
- Independent medical examinations: If the insurance adjuster schedules an IME (independent medical examination), you typically have to attend the appointment. However, these exams are rarely (if ever) independent and impartial. The doctor is a paid consultant who will likely favor the insurance company. IME reports are often used to reduce settlement values and deny insurance claims.
- Discouraging you from calling a lawyer: Insurance adjusters understand that knowledge is power. If you know the real value of your case and how injury claims work, you’ll make better decisions, which may result in a higher settlement or jury award. That’s why adjusters discourage people from calling injury lawyers. Don’t fall for the adjuster’s claims that lawyers are “too expensive” and will “slow the process down.” At Crosley Law, you’ll never pay an attorney’s fee unless we recover compensation for you, and we’ve built a reputation for our efficient and aggressive strategies.
- Unreturned phone calls: The longer insurance claims go on, the more likely the victims are to give up and accept a low settlement offer. That’s why some adjusters use delay tactics. The adjuster may avoid returning phone calls and ignore your questions. When the adjuster does this, they’re hoping that you’ll decide your legal claim isn’t worth the trouble.
- Victim blaming: Texas uses a legal standard called “comparative fault” in injury claims. If you contributed to your car wreck, the insurance company could reduce your compensation by your degree of fault. If you were 51% or more to blame, you’ll get nothing. Sometimes, adjusters try to blame victims to reduce or eliminate their compensation. Don’t assume the adjuster got it right — our lawyers have noticed a pattern of unfounded victim blaming in recent claims.
You may encounter these tactics whether you’re the policyholder or you’re filing a claim against an at-fault driver after an auto accident.
When Should I Settle My Injury Claim With the Insurance Company?
Settling a claim involves a level of risk; you’re giving up your right to demand any additional compensation. That’s why many people wait until their injuries have improved as much as possible before they settle. (Lawyers sometimes refer to this as “maximum medical improvement” or MMI.)
While you can settle before you reach MMI, you should do so with extreme caution. When you’re actively healing, it’s hard to foresee your future medical needs. Unexpected infections, complications, and repeat surgeries are common. We’d strongly encourage you to schedule a free consultation with one of our lawyers before you finalize an early settlement.
How Much Should I Get in an Insurance Settlement?
When injury lawyers calculate settlement values, they consider many factors. Your claim’s strength and the settlement amount will depend on:
- How much insurance coverage applies to your claim
- The extent and severity of your injuries
- Your current medical bills
- How much medical treatment you will need in the future
- Whether you can return to work
- Whether you can live independently or need help with daily tasks
- Your pain and suffering
- The cost of repairing or replacing your damaged property
- Funeral and burial expenses
- The potential for punitive damages
You’ll need to collect all of your medical bills, insurance policies, accident-related receipts and expenses, and other information as part of your analysis. It’s not easy to calculate all of these losses, especially when you’re recovering from a catastrophic injury. At Crosley Law, we carefully calculate our clients’ settlements, often consulting with life planners, medical experts, and other specialists.
We also identify each at-fault party and insurance policy that applies to our clients. Many victims don’t realize that injury claims can involve more than one negligent party and insurer. While multiple sources of liability can add complexity to your claim, it can also lead to a better settlement or verdict.
How Do Settlement Negotiations Work?
Negotiating a settlement requires a comprehensive strategy, clearly defined goals, and an understanding of the claim’s real value. If you start your negotiations without a plan, it’s easy to make mistakes and undervalue your claim.
“Negotiating a settlement requires a comprehensive strategy, clearly defined goals, and an understanding of the claim’s real value. If you start your negotiations without a plan, it’s easy to make mistakes and undervalue your claim.”
Sometimes, the insurance company will start negotiations by making a settlement offer. Other times, they will ask you to propose a settlement value in a demand letter. Realistically, this first offer or demand is rarely your final number. The insurance company most likely offered you a lot less than your case is worth, and you probably asked for more than you expect to get.
From there, your lawyer and the insurance adjuster will go back and forth, responding to offers and counteroffers. If you reach a point where no progress is being made, your lawyer may suggest mediation or another form of alternative dispute resolution (ADR) to get negotiations moving again.
What Is Mediation?
Mediation is a powerful tool that can help settle insurance disputes. During mediation, a specially trained mediator guides the parties through negotiations. The mediator will look for areas of agreement and common ground, with the goal of finalizing a settlement.
Typically, mediation starts with everyone in the same room. Each side presents their argument, and the mediator will usually ask some questions.
Then, you and the insurance company’s representatives will go into separate rooms. The mediator will meet with you and your lawyer to discuss your demands privately. The mediator will do the same with the insurance company, often relaying messages back and forth.
At Crosley Law, we’ve had remarkable success with mediation. In 2018, we negotiated the highest mediated settlement in Texas.
What Happens if We Can’t Agree on a Settlement?
No one can force you to accept a settlement. If you and the insurance company can’t agree on a fair settlement figure, you can take your case to trial. While a trial always involves risk, it’s sometimes necessary.
At trial, a jury will listen to the facts and arguments from both your personal injury lawyer and the insurance company’s attorney. Then, the jury will issue a decision either awarding you compensation or denying your claim.
When settlement is impossible, our injury attorneys carefully prepare cutting-edge trial presentations and perform detailed jury research. Our goal is to get you the compensation you deserve and the resources you need to recover.
Crosley Law: Get Answers to Your Insurance Settlement Questions
Crosley Law is one of San Antonio’s most respected personal injury law firms. We’ve built a reputation for our sophisticated approach to negotiating settlements, mediation, and litigation. If you need help understanding your claim’s value, contact us today. We’ll set up your free initial consultation and give you advice about your case at no cost.
The content provided here is for informational purposes only and should not be construed as legal advice on any subject.