Understanding Personal Injury Settlements
One of the many benefits of obtaining a settlement in your personal injury claim rather than seeking compensation through litigation is that there is generally a faster resolution. This is because settlements involve the parties involved in the case working together to find a resolution that they can agree on rather than being at the mercy of the court’s schedule. However, when you’re in the settlement negotiations process, it can seem like it will never end.
Read on for more information about how long a personal injury case takes to settle, for more information about how long you have to accept your offer or how settlements get paid out refer to some of our other topics by our experienced personal injury lawyers.
When Should a Settlement Occur in a Personal Injury Case?
It is not unusual for the victims of accidents with clear liability and a likelihood of prevailing in court to obtain a settlement offer very early after becoming injured. However, never accept these early settlement offers until you speak with an attorney about your claim.
Settlements are final, so if you accept an early settlement and then later discover that your injuries are a lot more costly than you believed, you will need to pay the expenses you incur beyond the settlement amount.
The best time to consider settlement offers is:
- After you reach maximum medical improvement, which is the point in your recovery where your doctor feels no more meaningful progress will take place, even if treatment continues
- After you speak with an attorney who can investigate the details of your accident and injuries and establish a value to your claim based on the severity of your injuries and the actual expenses and impacts you have incurred or will likely experience in the future
- After your attorney has had the opportunity to guide you about the value of your claim and what constitutes a fair settlement, your attorney will not make the settlement decision for you. That is your responsibility. Your attorney’s role is to offer information to help you make the best decisions for yourself in your case
- Your attorney has had the opportunity to negotiate on your behalf to ensure your right to consider the insurance company’s highest offer. Initial offers from insurance adjusters on personal injury claims are often about 30 to 40 percent of the claim’s value, so negotiation is almost always necessary
How the Settlement Process Works
Usually, once your attorney has had the opportunity to collect the evidence and documentation necessary to establish a value to your claim, they will send a demand package to the at-fault party’s insurance provider, and the company will assign an insurance adjuster to the lawsuit.
After reviewing the details of the demand package—which includes information about how the accident occurred, documentation of expenses and injuries, and a demand for the overall value of the claim—the adjuster has three options:
- They can deny the claim and notify the claimant of the reason for the denial.
- They can approve the claim as submitted and pay the amount demanded.
- They can offer to settle the claim for less money than the claim’s value.
If the demand is accepted and paid, the case resolves. If the claim is denied, you and your attorney can consider filing it as a personal injury lawsuit in court. However, if the adjuster offers a settlement, your attorney can negotiate with them to garner a higher settlement offer.
Once you decide to accept a settlement offer, your attorney and the attorney for the at-fault party and their insurance provider will work to produce a settlement agreement, which is a legally binding contract. To get paid your compensation, you will be required to sign this agreement and a related release of liability, which bars you from proceeding with litigation or coming back to the insurer later with a demand for more money.
Factors That Can Delay a Settlement
Some settlements do not conclude until after a personal injury lawsuit begins. It is impossible to know how long it will take for the insurance adjuster to make an offer that constitutes fair compensation for the expenses and impacts of your injury, or even whether that offer will come at all. That is why it is essential to have an attorney who is as comfortable seeking your compensation through litigation as they are with negotiating a settlement.
Several factors can delay your settlement offer, including the ones discussed below.
Liability is Hard to Prove
The outcome of your claim depends on your ability to prove that someone else was liable (legally responsible) for causing your injuries.
Your lawyer can prove liability by showing:
- The at-fault party owed you a duty of care in a given set of circumstances to take reasonable actions to avoid causing harm to others
- A breach in this duty occurred when the at-fault party violated the duty of care
- This breach resulted in an accident in which you became injured and subsequently incurred expenses and impacts
Waiting for Maximum Medical Improvement
There is no standard time for recovering from injuries, and specific injuries take longer to heal. Waiting for maximum medical improvement is necessary to determine your injury’s full financial and psychological impacts. Unfortunately, this can take many months or even longer.
High Valued Claims
In cases in which there is a clear liability on the insured, and the injuries that the claimant sustained are likely to produce permanent injuries resulting in lost earning capacity and other lifelong impacts, you would think the settlement process would go quickly. However, these cases are often the ones that are hard to settle, as the insurance adjuster will investigate every aspect in search of reasons to reduce the amount that their company must payout on the claim.
Racing Against the Clock: When Settlement Negotiations Stall
When those who are injured are seeking compensation through a third-party insurance claim, they have the option of filing the claim in court as a personal injury lawsuit. However, while there is no precise time limit on the settlement negotiations process, there is certainly a time limit for filing a personal injury lawsuit.
The statute of limitations gives you a deadline to file a claim. To keep your option for seeking compensation through the state’s civil court system open, you must file your lawsuit by that date. However, settlement negotiations can continue after that point. After that, many clients see more serious offers from the insurance adjuster, as they want to avoid litigation’s time, expense, and uncertainty.
Interestingly, it is not uncommon for the insurance provider to also play the clock, delaying higher offers in the hopes that the claimant will wish to avoid litigation and become desperate with the approaching statute of limitations on their claim. A personal injury lawyer knows the delay tactics insurance companies use and can call their bluff with a lawsuit.
The Length of Time After Settling
Once a personal injury claimant has decided to accept an offered settlement, the agreement is in place, and plaintiffs sign the release, many are surprised to discover that they still must wait several weeks for their compensation to arrive.
The wait, though unfortunate, is necessary, as many actions need to be taken, including:
- The insurance company will process the check, which can take up to a week. The payment will go to your attorney
- Your attorney will deduct the percentage of the settlement that you agreed to provide in the contingent fee agreement and pay any liens against the settlement placed by creditors such as healthcare providers or health insurance companies
- Once your attorney has satisfied all of their responsibilities as outlined in your agreement, they will meet with you to finalize your case. You will sign some documents, and your money will be sent to you by check or direct deposit
Is There Any Way to Speed up the Process?
Yes, Rest assured, your attorney understands the urgency you have for the compensation from your settlement. In many circumstances, they can hurry the process along by drafting the release form when it appears a settlement is imminent so that it is ready to go and using expedited shipping to send documents to the insurance provider.
You can help your attorney speed up the time it takes to settle your claim by meticulously gathering as much evidence as possible that proves liability. It may also help to keep a journal of your doctor’s visits, treatments, and other impacts you incurred due to the at-fault party’s negligence.