Should I Accept the First Insurance Settlement?

When a person has suffered an injury due to an accident, receiving compensation is often complicated. Insurance claim adjusters will do whatever they can to offer the lowest amount possible. After all, they are in the business to save their company money at the expense of the injured party.

This is why you need a highly skilled and experienced personal injury attorney who will fight to maximize the highest possible dollar amount.

Insurance companies tend to take advantage of a person who has just suffered a traumatic event. The adjusters can often be quite intimidating and express to the injured party that they “have to” take their offer because they won’t get a better offer. This is not true. Unfortunately, people who choose not to be represented by a lawyer will often jump on the first offer that is made available to them. They don’t realize that they are entitled to so much more!

The insurance companies have a mission when a claim comes to their office. They will usually contact the injured person immediately before they have the chance to talk to an attorney. They want the person to agree to take whatever small amount they’re offering. Once you have accepted their offer and gotten the money, that’s it. The case is officially closed and you are not entitled to any other money.

A person may not even be aware of the extent of their injuries or the financial impact it has had on them before the insurance company reaches out with an offer. Therefore, the person can’t make a reasonable assessment of fair compensation. This is what the insurance companies hope for. So, once you have accepted any money for an accident, you can no longer negotiate for a better amount regardless of new evidence or costs in the matter.

The same is true for accidents that don’t involve insurance companies. The responsible (or at-fault) party may try to get you to take a small amount of money in return for promising not to sue them for negligence. It is important not to let anyone buy your right to fair compensation for your suffering. You deserve justice. Don’t sell yourself short.

Should You Accept The First Offer Of Compensation?

The answer is “no,” plain and simple. An array of factors determine the fair monetary value of your case. To get the money you deserve, you must first identify these factors. Only then can you find out what each aspect of your personal injury is worth.

For instance, this is not only about your medical bills. The treatment of the physical injury is important, but it is not the only reason that you deserve money. Depending on the severity, you might have missed out on work, had to pay out-of-pocket expenses for pain medicine or physical therapy, or you have to pay for mental and emotional health support for the suffering inflicted on you.

Reasons For Not Accepting the First Offer

In almost every personal injury case, the first offer for compensation will generally not be anywhere close to the actual value of the injury. However, it is routine for insurance companies to provide the lowest possible amount with the hope that a person is either desperate enough to take it, or not represented by a personal injury lawyer.

When the claim adjusters offer that amount, they expect negotiations to ask for more money. The truth is, the more you fight and provide evidence that you deserve more, you will continue to get better settlement offers until you reach a fair dollar amount.

You have the right to refuse their offer and renegotiate. In most cases, you should reject the first amount. If a personal injury lawyer represents you, they will advise you when to renegotiate and when to settle. Their job is to get you the maximum amount possible. The first offer is usually a way to open up negotiations.

Your lawyer may determine that a demand letter is a necessary strategy to effectively present your position. They detail what has happened, the injuries and treatment that resulted due to the negligence of the other party, and a fair dollar amount to extend justice on your behalf.

The demand letter is a great way to respond to the initial offer. In your demand letter, your attorney will make a counter-offer. After that, you may end up getting several more offers before your lawyer decides that the monetary value of the injuries is satisfied and there will be no basis to ask for more.

Remember, this process operates much like a business. The insurance company will never start the negotiation with the highest amount they are willing to pay. Even if they tell you that they “won’t go any higher.” You and your attorney can decide a fair minimum. This is when you may decide to settle—but not before that.

What Can You Expect From Negotiations?

Even though you and your lawyer know that you are being low-balled by the insurance company, it is common practice to ask them how they come up with the figure. Then, your lawyer will respond with a more reasonable settlement demand. Your lawyer will likely ask for the highest achievable amount.

Each case is unique. Here is an example of how a “slip and fall” accident might go:

1) You are given a low-ball offer from the insurance company that barely covers the medical bills.

2) Your attorney will respond with a more accurate amount and why the insurance company should meet your demand. This introduces evidence to spark a higher figure.

3) This is when the back-and-forth of the negotiations takes place. The letters and phone calls will continue to keep the dollars rising in your favor, especially as your lawyer presents new possible testimony or presents new evidence showing the severity of the injury.

Example: When the negotiations started, your injuries seemed moderate and your doctor recommended a specialist. The first few exchanges (between the lawyer and the insurance company) occurred before your lawyer received new evidence that your injury is so severe that you may not work for a longer time and you need surgery. That information just set a new minimum, and the attorney has more leverage to ask for a higher amount to start a “better” negotiation strategy.

4) Finally, when you reach the appropriate amount, you can decide to settle. There will be papers to sign stating that you agree with the amount for the damages, and you receive a check.

What Is a Reasonable Offer?

The at-fault party hopes you will not hire a lawyer. Their whole case depends on it. If you stay unrepresented and try to do everything on your own, you will not get as much monetary compensation as you deserve, even if you have extensive legal education.

Not just any education will do. You must have substantial personal injury knowledge to know what you are entitled to and successfully go through the process of getting it.

Remember, the insurance adjuster must protect their client. That is the at-fault party in your case. They will not advise you of your rights or help you understand a reasonable offer. They have two primary goals—to protect their clients and save their company money by minimizing the payout for your injuries.

If you don’t know what damages to pursue, you won’t understand what would pay your bills from the accident.

This is especially true when you need future treatments to fix the problem and get you back to your quality of life.

Don’t let anyone talk you out of getting a consultation to find out what your case is worth. This is your life, your expenses, and your injuries. Don’t let anyone call the shots except you.

Another thing that you might consider. It’s a topic that tends to come up with countless personal injury cases. A person hears that they will not get much, if anything, from a settlement, because they already had an injury. This is not true. A lawyer can set many things straight for you and explain what you can or can’t expect.

Settling a Case Too Early

Do not settle a case too early. Give yourself enough time with your doctors to determine the extent of your injuries. In the example shown above, had the person jumped on the settlement offer before the specialist discovered that they would miss work longer and needed surgery, they would miss out on a lot more money to cover their damages.

Even something seemingly not as serious, like mild/moderate back or neck pain, might make a person think that there isn’t much they can recover for, so they settle early. They find out later that they need years of therapy or surgery to fix the problem to return to their normal duties.

Don’t fall for the scare tactics of the insurance companies. They may tell you (if you don’t have a lawyer) that you only have a short time to accept their offer or you won’t get anything and they will close your case. This simply isn’t true. The law, and only the law, decides how much time you have to sue for damages.

Include All Types of Compensation In Your Negotiations

Some cases are more complex. More than one person may have caused your injury. This is a great reason to hire an experienced personal injury attorney. They can assess, after gathering all of your information, who or how many are at fault, which may significantly increase your recovery potential.

If you decide to settle and not get legal representation, you could miss out on a great deal of monetary compensation. It’s no surprise that people who have a lawyer fighting a personal injury case on their behalf tend to receive the money that they deserve. But, in cases with multiple people at fault, they are significantly damaging themselves financially.

Economic & Non-Economic Damages

There are two primary categories for which you may recover compensation.

Economic: generally means all things with a specific monetary value. Such as medical bills, the loss or repair of property, loss of income, etc.

Non-Economic: refers to mental or emotional distress, reduced quality of life, pain, suffering, loss of consortium disfiguration, etc.

To maximize your recovery, partner with a highly skilled personal injury attorney with a wealth of experience in these matters. You need justice to prevail and a fair agreement that covers all of your expenses and the value of things that don’t come with a price tag.