Surprised? Don’t be. Insurance companies exist to make a profit for their shareholders (or policyholders, in the case of a mutual insurance company). Their income is normally in the form of premiums and returns on investments. Costs include the overhead that comes with their operation and payment of claims.
There’s an incentive not only to make a low ball offer in hopes the injured party will be happy with it; if not, they will drag on negotiations, because time is money. The longer that settlement money is in the insurance company’s hands, the more interest and return it makes on it. The claimant might also get frustrated over time, give up and take whatever he or she can get and move on.
What you don’t know can hurt you
The first thing you should do to try to increase what the insurance company is offering is to talk to a personal injury attorney.
The first thing you should do to try to increase what the insurance company is offering is to talk to a personal injury attorney.
• If you’re like most people, including many lawyers, you don’t know negligence law. You don’t know the latest court decisions or how juries have been deciding cases similar to yours. You don’t know whether or not you have a strong case.
• You don’t know insurance law, also like many attorneys. Personal injury attorneys normally avoid cases where insurance policies don’t apply. In most cases it's not worth trying to successfully sue and then collect on a judgment when an individual or business that lacks proper insurance is the defendant. Assets disappear, parties move out of the state or out of the country or declare bankruptcy. If you don’t know insurance law, you don’t know whether your claim would fall under a party’s insurance coverage and, if so, what kind of potential exposure (the amount of money it may need to pay) that insurance company is facing.
• Because of your lack of knowledge and experience, you don’t know the value of your claim. An experienced personal injury attorney should know that value. Without knowing it, you have no idea whether what you’re asking for or what you’re being offered is fair and reasonable. Negotiating a settlement in this situation is like trying to fight someone with both hands tied behind your back.
For most personal injury attorneys, an initial consultation is free, so it just costs you the time and energy to engage in the conversation. Given the situation, what the insurance company is offering may be reasonable. You may be clearly at fault. You may have little or no damage to your vehicle and managed to escape the accident with few or no injuries. The reality may be that your case is worth about what the insurance company is offering you, so the wisest choice may be to accept it and move on.
In many other cases, it’s clear the insurance company is not being reasonable or fair. Insurance settlements for negligence claims are normally based on negotiations. The first offer may have been made with the thought that you probably wouldn't take it. The insurer hopes that by starting low, you’ll eventually agree to an amount that’s lower than what they were actually willing to pay.
In addition to not knowing personal injury or insurance law, you may not know how to negotiate -- a major part a personal injury attorney’s job. Very few of us, in the course of our lives, seriously negotiate anything. You might negotiate a raise or the price of a house, but how often do you do that? The vast majority of these cases settle, and much of an attorney’s time can be spent in preparing for negotiations, then engaging in the back-and-forth that normally results in a settlement both sides can accept.
Facts are the foundation of a legal claim
A critical part of representing an injured party is an investigation into the incident. A personal injury claim is built on its facts.
• By documenting your injuries, obtaining and organizing medical records, medical bills, proof of lost time at work and receipts for related expenses you can help your attorney determine your case’s value. Photos or videos of the accident scene, as well as a copy of the police report, would also be a big help.
• Your attorney, a paralegal or an investigator may also go to the site of the accident, try to obtain video of the accident from nearby security cameras and interview witnesses.
• Medical experts may examine you and your medical records to determine the extent and duration of your injuries. Another expert may review the facts of the accident to come up with an opinion on how the accident happened and who’s to blame.
After an investigation and reviewing the applicable law, an experienced personal injury attorney should know the value of your case. In these types of cases, knowledge really is power, because without knowing the value of your case you have no power to negotiate the best settlement possible.
Do you want a better offer from the insurance company? Talk to a personal injury lawyer and get feedback on your claim and what you should do next. Retaining an attorney to represent you in your dispute may or may not be right for you. But without being fully informed about the law, your rights and the merits of your case, you can’t make an educated decision on how to proceed. Hopefully your future will include a better offer from the insurance company, but that may not happen without the guidance of a personal injury attorney.
Hello, my name is Jack Sparrow. I'm a 50 year old self-employed Pirate from the Caribbean.
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