Should I Take the Insurance Company’s First Settlement Offer?
After an accident, the responsible party’s insurance company may swiftly present a settlement offer if their policyholder is deemed at fault. While the offer might be tempting, it’s essential to note that the initial settlement is often considerably lower than the actual value of your claim. Consequently, it is highly advisable to refrain from accepting it immediately and seek legal advice.
Settlements Agreements are Binding
When an insurance company extends a settlement offer, it typically arrives in the form of a letter containing instructions to sign and return for a subsequent payment. By signing the form, known as a release of liability, you effectively waive your right to sue the at-fault party for additional compensation. Despite insurers creating a sense of urgency, implying a “now or never” scenario, this is often a tactic used to settle claims swiftly and minimize payouts.
Wait Until You Recover
Accepting an initial settlement comes with the risk of underestimating the extent of your injuries and associated financial losses. Your injuries might eventually reveal themselves to be more serious than you initially thought, leading to insufficient compensation for a complete recovery if you have already settled the claim. For example, you may experience delayed pain, unexpected complications, or the need for more extensive treatment. Therefore, it is crucial to reach either full physical recovery or maximum medical improvement (MMI) before considering the amount of compensation you should settle for.
Determining the Value of Your Case
Determining the value of a personal injury claim is a complex process that involves various factors. Attorneys use their experience, legal knowledge, and assessment of the specific circumstances surrounding the case to arrive at an estimate before negotiations with the insurance company. Here are the key elements they will consider:
Extent of Injuries
The severity and nature of your injuries play a significant role in determining the value of your claim. Medical records, expert opinions, and ongoing treatment needs help assess the current and future impact on your life.
Attorneys consider your current and anticipated medical expenses, including hospitalization, surgeries, medications, rehabilitation, therapy, and any other necessary medical treatments.
Lost Income and Future Earning Capacity
Lost wages due to time away from work, as well as potential future income loss or diminished earning capacity resulting from the injury, are factored into the valuation. This includes evaluating the impact of the injury on your ability to perform your job.
If the personal injury claim includes property damage, such as damage to a vehicle in a car accident, the cost of repairs or replacement is considered in the overall valuation.
Pain and Suffering
Non-economic damages, like pain and suffering, emotional distress, and loss of enjoyment of life, are subjective but critical components. Attorneys use various methods, including multipliers based on economic damages, to quantify these damages.
Evidence of Liability
The strength of evidence proving the liability of the at-fault party is crucial. If there is clear evidence establishing the other party’s fault, it strengthens the case and may contribute to a higher settlement value.
Insurance Policy Limits
The available insurance policy limits of the at-fault party influence the potential recovery. If the responsible party has the minimum insurance coverage, it may impact the maximum compensation that can be obtained.
By carefully considering these factors and others, an experienced Waco personal injury lawyer can arrive at a reasonable estimate of the claim’s value before entering negotiations with the insurance company. However, this estimate serves as a starting point, and the actual settlement amount may vary based on negotiations and other legal considerations.