Car Accident Settlements
Car accidents are stressful. Even when you’re not at fault, the aftermath of a collision on the road can be incredibly trying. Whether you’ve suffered serious injuries, damage to your vehicle, or psychological trauma from the experience, it’s easy to feel overwhelmed by what comes next. In many cases, there needs to be a discussion about a car accident settlement.
After collecting the contact information of the other driver and seeking medical attention, it can be difficult to know where to turn for justice and the compensation you deserve. All that becomes clearer once the at-fault driver’s insurance company presents a car accident settlement offer letter.
Even with money on the table, though, it can be difficult to know if you’re being treated fairly. Many times, insurance adjusters will lowball accident victims, offering them far less than what they deserve. These companies know that many car wreck victims are unfamiliar with the negotiation process that comes after a wreck. They trade on that knowledge and their experience with negotiating.
Learn more about how car accident payouts are calculated and how you can improve your chances of getting a financial award and increase the amount you receive for your injuries, vehicle damage, and lost wages from time off work.
While conversations with claims adjusters may seem like more trouble than they are worth, it’s important not to back down on what you feel you’re owed. They say knowledge is power, and that’s especially true when your health, safety, and finances are on the line. It may be tempting to take the first offer that an insurance company sends your way. Do so, and you’ll likely never be able to pursue a personal injury claim for the damages you suffered ever again.
Here is our guide to car accident lawsuit settlements. We can help you determine your damages, collect evidence in your favor, acknowledge any contributory negligence, and understand the ways in which insurance companies frequently negotiate down personal injury settlements.
Keep reading for a thorough analysis of the process and for guidance on when and how to find an experienced attorney.
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Documentation
From the moment you’re involved in a wreck, it’s important to collect documentation of every aspect of the incident. While it’s normal to be shaken up after a crash, it’s crucial that accident victims collect the name, address, phone number, license plate, driver’s license and insurance information from the other motorists involved.
If possible, as you await the police or paramedics, snap photos of these details on your phone. It’s a quick and easy way to ensure you’ve covered your bases and can refer back to the information whenever necessary. Take photos of skid marks or other noteworthy markings on the scene. This includes things like signs and traffic lights, especially if the driver ran a stop sign or red light. Also, photograph any damages done to your vehicle if you can, such as a loose bumper following a rear-end collision.
In the days and weeks following the collision, there is even more documentation to collect. You’ll want a copy of the official police report, as well as any medical records associated with the crash. Any photos you might have snapped at the scene of the accident also count as documentation.
The more documents you can collect, the better, since they serve as evidence of your damages. Even personal journal entries, text messages to friends, and video recordings of the accident scene can help bolster your case.
Begin the Settlement Process
Next, you’ll want to contact both your own insurance company as well as the other driver’s. Even if you’re not at fault, it’s a good idea to alert your car insurance company that an accident has occurred. If the collision was not your fault, you’ll want to initiate your claim through the at-fault driver’s insurance company.
If who is at fault is less clear, you may opt to file a claim with your insurance company. If you’re to blame for some or all of the incident, your insurer can help you understand what comes next. If you’ve been involved in a wreck with a motorist who lacks insurance coverage, your insurance company can also help you recoup the costs associated with your crash. Most states require drivers to hold some form of uninsured motorist coverage, so check with your insurer to understand how much your personal injury claim could be worth.
Regardless of whose insurance you file a claim through, be prepared to recount your experience on the record. You’ll be asked about a number of factors including the moments leading up to the crash to determine your role in the collision. Details about the time, road conditions, weather, and traffic pattern may also come up. It goes without saying that this is a time to be honest—bend the truth at all, and you risk losing your personal injury settlement.
The Settlement Letter
After filing a claim, you’ll receive a letter in the mail from the insurance company. This reservation of rights letter will confirm that they have received your claim and plan to move forward. The letter does not, however, accept your claim as fact. Instead, it’s helpful to look at this reservation of rights letter as the marker of a potentially lengthy claim process.
At this point, many car accident victims opt to find an experienced personal injury attorney to represent them. Despite how honest you’ve been in the wake of the wreck, insurance companies will start to look for any reason to deny your claim. Like any other industry, the insurance industry is out to turn a profit. They’ll resist paying out high dollar figures, opting instead to lowball accident victims who are eager for a settlement.
Not every car accident claim requires an attorney. Since most personal injury lawyers offer free consultations, though, it’s worth investigating your options. You might consider a lawyer referral service to find attorneys in your area.
Should the insurance company argue that you haven’t provided enough evidence, or that the accident was partially your fault, you’ll want a professional by your side to advocate on your behalf. Regardless of whether or not you decide to hire an attorney, it pays to remain calm and stick to the facts in the face of such accusations.
Settlement Negotiations
An attorney can create a demand letter outlining the damages you’ve suffered because of the crash. This includes your medical bills, car repairs, out-of-pocket expenses and any income you’ve missed out on because you were involved in an accident. Even psychological trauma can be considered a form of financial damage, so long as you have evidence that you’ve sought therapy or paid for some kind of support for the emotional pain you’ve suffered. In cases of severe injuries that require surgeries, you may be able to seek future damages as well.
In turn, the insurance company’s claims adjuster will respond with an assessment of the damages for which they’re willing to pay. Don’t be surprised when the amount offered is lower than expected—at this point in the process, they’re hoping to close out the claim as cheaply as possible. When your life has been turned upside down by an accident, it’s hard not to take such offers personally. Still, it’s important to remain level-headed in the wake of a low-ball offer. You can take their settlement or opt to continue negotiations.
The back and forth of these negotiations can be stressful. At any point in the process, you can bring in an attorney to take over on your behalf. In some cases, you may even want to escalate your claim and file a lawsuit against the insurance company instead of settling. This is a less common approach; most car accident claims are settled out of court. If you and your attorney find their amount of compensation unreasonable though, it’s within your right to take legal action.
Filing a Car Accident Lawsuit
A lawsuit is the biggest threat you have against an insurance company. While it’s possible to file without an attorney, the process can be overwhelming for those unfamiliar with how to do so. In most states, lawsuits begin when someone files a complaint with the court. It outlines the wreck, personal injuries, other damages sustained, and the legal basis for the lawsuit. Once the complaint is officially filed, the lawsuit begins.
Next, the defendant will be served notice that they are being sued. The summons details why they are being sued and the next steps to take. In most cases, defendants must be served within 30 days of the lawsuit’s filing. The defendant then has the opportunity to respond to the summons and admit to the accusations or deny their truth. Typically, this is the stage where a defendant uses a lawyer referral service to find representation.
In many cases, negotiations continue between the insurance company and the plaintiff even after the lawsuit has been filed. At any point, the lawsuit can be settled out of court. In most situations, insurance companies will avoid going to court unless absolutely necessary. A car accident attorney can advise you on whether it’s a smart idea to sue the company.
Lawsuit Limitations
In no-fault states like Florida, Kentucky, and New York, car accident lawsuits are rare. That’s because certain qualifications must be met before someone can file. In such states, accident victims may only file suit if their damages exceed a particular amount, or if their physical injuries surpass a specific threshold. Each no-fault state has their own standards for car accident lawsuits, so be sure to read up on your local rules and regulations before deciding to file suit.
A Fair Outcome
Ultimately, the best way for accident victims to handle a suit is to aim for a fair outcome for their situation, rather than trying to go after the at-fault driver or their car insurance policies for all they can get. While a windfall might be nice, a just verdict isn’t guaranteed. While you may see large jury awards and feel reluctant to settle your claim for a reasonable reimbursement, there are risks in filing a lawsuit. The judge may decide in favor of the defendant, leaving you empty-handed—or suffering an economic loss paying their court costs.
There are serious benefits to settling out of court. You’ll avoid court dates and appearances and see compensation in a more timely fashion. The savings on litigation can be significant. For these reasons, it’s easy to see why so many car accident lawsuits settle out of court. While insurance companies may be out to turn profits, they’re all typically willing to help settle claims so long as you are honest, polite and reasonable. By showing evidence of the at-fault driver’s liability and a record of your damages, you’ll present a claim that’s hard to argue against.
The Legal Partner You Need
Most of us don’t give car accident claims, lawsuits or claims adjusters much thought until we’ve been involved in a wreck. While some accident victims opt to represent themselves throughout the negotiations and settlement process, many prefer to find an experienced personal injury lawyer to represent them. Car accident attorneys are extremely knowledgeable about the claims process and can help guide you through what a fair offer looks like. In many cases, personal injury attorneys offer free consultation appointments to discuss the legal options of prospective clients.
If you’re considering hiring an attorney, it’s worth setting up a few consultations and weighing your experiences. With the help of Lawsuit Info Center’s guide to local lawyers in your area, you can quickly and easily chart your path to a just verdict. While it’s impossible to predict the outcome of a case or state a number for an average car accident settlement, consultations can still provide clues as to what lies ahead. Even if you opt not to hire a lawyer, chatting with experienced professionals can help give you much-needed insight into your claim.
Find an Auto Accident Attorney
Our website is a veritable treasure trove of resources for those who have been in car accidents. Start by plugging in a few facts about your collision into our car accident settlement calculator. It’s a great starting point for those curious about how much their case might be worth.
Should you decide to work with a lawyer, we’ve got you covered there, too. With a few clicks of your mouse, you can connect with quality attorneys in your area. Prefer to chat on the phone? Call 877-810-4067 to talk to our helpful team. No matter the circumstances surrounding your crash, Lawsuit Info Center has the resources you need to make the best of a bad situation.
Frequently Asked Questions:
If you were in a car accident, you probably have a stack of medical bills, lost earnings, and emotional distress. Should you file a claim and try to get a car accident settlement?
Below are some of the factors to consider if a car accident settlement is worth it:
- How serious was the accident? If it was a fender bender with no injuries, filing a claim and getting a settlement may not be worth it. If your damages are more serious and you have injuries, you may want to negotiate a car accident settlement, especially if the other driver was at fault.
- Who was at fault for the accident? If you were entirely or mostly at fault, you probably will not be able to collect money for your damages and injuries from the other driver’s insurance policy. Your own insurer will repair damages to your vehicle, and it may cover some of your healthcare expenses.
- Was your injury entirely new and due to the crash, or did it aggravate a previous injury?
- Was your treatment excessive? An auto insurance company will not give you the full value of your medical expenses if they determine the treatment was too expensive, especially if the care was physical therapy or chiropractic in nature.
- Did you seek medical treatment right away? This is important so the insurance company knows that your injuries are related to the accident itself.
In a car accident case, there are two types of damages available to the injured party. These are economic (special) and non-economic (general) damages.
Special damages are simple to calculate because they involve your property damage, medical bills, and lost earnings. They are easy to calculate. General damages refer to pain and suffering, which means physical pain and discomfort, but also emotional stress and anxiety.
It is hard to determine what pain and suffering is worth. But insurance companies usually rely on one of two approaches.
The first is the multiplier method. This is where the company adds up your economic damages, and multiplies then by 1.5 to 5, depending on the severity of your injuries, recovery time and whether the driver was clearly in the wrong.
Other insurers may use the daily rate or per diem approach. This method assigns a certain dollar amount for each day you have to live with the pain of the accident. You can ensure your per diem rate is ‘reasonable’ by comparing it to what you earn in your job each day.
If you are trying to negotiate your own settlement, use both the multiplier and per diem approaches and see what you come up with. If they are very different, that is fine. At the end of it all, you will need to negotiate that number with the insurance company. At least you have a ballpark range of what you should settle for. If you have questions or are feeling uncertain, have a personal injury attorney represent you.
If a car accident case is settled out of court, the amount of the settlement and case details are not public record. Most car accident claims are settled out of court, so odds are that your case is not public record.
However, cases arise where the plaintiff and defendant cannot agree on a settlement, and the case goes to court. If you file a personal injury lawsuit in court and the case is decided by a judge or jury, the results ARE public record.
Whether the result of your case will be private or public record can be a factor when you are thinking about settling or filing a lawsuit. Most insurance companies and plaintiffs want to settle out of court. This can happen in arbitration or mediation, rather than going to court because more flexibility is allowed and costs less. Settling also keeps your name out of the public record.
Your attorney can advise you on whether to file a lawsuit or not. If you want to keep the details of the case and settlement private, filing a lawsuit may not be a good choice for you. Your attorney also can rely on his previous litigation in car accidents and determine whether it is likely you could prevail in a trial.
If you were in a car accident and you think you want to settle it yourself, below are the steps to follow.
But you should first consider how badly you were hurt, and whether the other driver clearly was at fault. If your injuries run into the thousands of dollars and/or fault is questionable, you may want to hire a personal injury attorney.
That said, here are the steps to follow to settle your car accident case:
- Take photos of the property damage, scene of the crash, and your injuries.
- Obtain a copy of the police report.
- Get the medical treatment you need as soon as you can
- Do not provide a recorded statement to the other driver’s insurance company.
- Do not use social media to talk about your accident.
Next:
- Calculate your ‘special damages,’ which are your medical bills and lost work time.
- Calculate your ‘general damages,’ which refers to your pain and suffering. Pain and suffering is often calculated using a multiplier between 1-5. One is for minor injuries, and 5 is for serious and even permanent injuries. Most pain and suffering injuries in car accidents are valued at 2 or 3. That number is then multiplied by your special damages.
Once you have completed the above steps, you will send a demand letter to the other driver’s insurance company. Your demand letter should include:
- Why the defendant is liable for your injuries.
- The nature and extent of your injuries and the medical treatment you had.
- Financial losses caused by the accident.
- Pain and suffering.
The insurance company may respond with a low offer, but do not take it. This is the starting point for negotiations. Make a counteroffer and continue to negotiate until you get what you think is a fair settlement. If you feel the insurer is offering too little, consider hiring a personal injury attorney.
In a best-case scenario, a car accident settlement will take a few weeks. This however, rarely happens. Insurance companies are known to try and offer lowball initial settlement offers to save money. Adjusters will often play on the lack of knowledge of most people injured in car accidents, and the desire of the plaintiff to get the situation resolved quickly, to get away without paying the total amount of damages.
This is why it’s so important to take pictures, talk to witnesses, and hire a good car accident lawyer. In most cases, the initial offer is just a starting point for negotiations… then it’s up to the plaintiff to document medical bills, lost wages, and lifestyle adjustments made due to the injuries caused as a means of proving the monetary value of their claims.
As the evidence gathering, witness statements, and back & forth negotiations all take time, the car accident settlement process can take many months and in some cases years, to reach a fair settlement.
The car accident settlement process can range from quick & painless, to long and drawn out, depending on the details of the accident, the complexities of the case, and the insurance companies & attorneys involved. In general, here is the timeline for the car accident settlement process:
- Claim gets filed with the “at fault” party’s insurance company
- Insurance company investigates the claim, gathers evidence, and speaks to witnesses & experts, etc.
- Initial settlement offer is made to the plaintiff
- If satisfactory, the settlement is reached and the matter is closed. However this is usually not the case, as insurance companies will often times try to lowball the initial car accident settlement offer.
- If the initial settlement offer is not satisfactory to the injured party, there is a negotiation process that can involve many rounds of back & forth, usually with both parties presenting evidence and arguments as to why their position is correct.
- If a settlement amount that works for everyone is reached, the process is over. If not…
- The process of filing a car accident lawsuit can follow, which will then take many more months, if not years, to litigate. As such, it’s usually in everyone’s best interest to reach a fair settlement for the car accident.
While many factors along the way can affect the time and outcome of a car accident settlement, documenting everything, knowing how to deal with insurance companies, and hiring a good car accident attorney can all help make the process smoother and faster.
The simple as yes, you can negotiate a car accident settlement. In fact, most car accident injury lawsuits are settled by the parties before a trial is held. Only a small fraction of court cases ever go before a jury. Instead, the parties to the case most often agree to settle the case and avoid the need for a jury trial.
In most cases, an insurance company can save thousands of dollars by negotiating a settlement to a car accident case, rather than going to trial and letting a judge or jury decide how much an injured party should get. For an injured party, negotiating a car accident settlement can provide a faster way to receive financial compensation they are entitled to without risking a long and expensive trial, which may not come out in their favor.
For these reasons, negotiating a car accident settlement is a common practice.
Negotiating your car accident settlement may be common, but it can be complicated. Most of the time, you’ll want a qualified motor vehicle accident attorney on your side, helping make sure that your legal rights are upheld while you negotiate your car accident settlement. Your attorney can help make sure that you are fairly compensated for your injuries, including medical bills, lost wages, pain and suffering and other damages.
How your car accident settlement will be paid out depends in part on the status of the other driver who hit you. If the person you are settling with is uninsured, make sure your agreement is in writing and signed by both parties, not just a verbal agreement between you and the other driver, which may not stand up in court.
Depending on the laws in your state, you may be able to file a lien on the at-fault party’s property or pursue a judgment against the driver either through small claims court or local civil court.
If you are dealing with the other driver’s insurance company, it’s a more straight-forward process. Typically, once you’ve agreed to a settlement amount, the other driver’s insurance company will send you or your attorney a “release” for your signature. In this legally binding document, the insurance company agrees to pay you a stated amount in exchange for your giving up the right to pursue the insurer, or the insured other driver, for any future damages arising out of this particular car accident. In most cases, the insurer will not pay you the amount until it has received back the signed release. But once the release is returned, the insurer will send a settlement check.
If you are represented by an attorney, the check from the insurance company will usually be made out to you and your attorney. Your attorney will deposit the check in a law firm account and will write you a separate check after taking out any of his or her attorney fees and costs.
It’s important to note that in most states, lawyers, doctors and others who are owed money for working on your case get paid first before the balance of the settlement amount is paid to you, the injured party.
Here are some ways you can maximize the compensation you receive for your car accident settlement:
Take pictures: They say a picture is worth 1000 words – never is that more true than when negotiating a car accident settlement. Make sure to get pictures of everything you can – your car, their car, road conditions, traffic signs, etc.
Watch what you say: Sometimes a simple explanation or apology can be misconstrued as an admission of guilt. Don’t say you’re sorry, or you should have been paying more attention, or say you were distracted. Your words can and will be used against you.
Get help: It’s always a good idea to speak to a lawyer who can help you better understand your situation, potential damages, and other ways to maximize your auto accident settlement. Almost all personal injury attorneys will give a free consultation, so there is no harm in getting an expert opinion or two.
In the US, the average settlement for a car accident is somewhere around $20,000, maybe $25,000, depending on who’s stats you go by. One thing to keep in mind about averages, is that they’re often skewed by a few outliers, and this is certainly the case with car accident settlements. Just like if Bill Gates or Jeff Bezos walked into a room, the average net worth in that room would instantly go up by millions, a handful of multi-million dollar settlements bring the average number up quite a bit… so when factoring that in, the average “average car accident” settlement is probably closer to $15,000 or so.
There are 2 parts to this – the negotiation, and the process of getting your check. Once the settlement is agreed upon, the process usually takes 2-3 weeks for the insurance company to issue a check. However the negotiation prior to the agreement can take months, sometimes years, depending on the severity of the auto accident and the amount of ongoing medical treatment associated with the injuries.
The decision to hire a lawyer for a car accident settlement depends on a number of things. Mostly, it comes down to the severity of the accident and related injuries, as well as your faith in your ability to negotiate & desire to deal directly with insurance companies. Here are a few questions you can ask yourself to determine the answer to this question:
- How serious was the accident, injuries, and impact on my life (i.e. ability to work, enjoy normal activities, etc)?
- Do I have the time and/or desire to deal with both parties’ insurance companies, possibly for months?
- Do I know enough to negotiate a fair car accident settlement for myself? Or…
- Do I think a lawyer will get me substantially more money that I would get on my own?
Once you have honestly answered these questions, you should have a good idea which direction to go. IAs a general rule, the more serious the accident and injuries, the more likely it’s in your best interest to hire an attorney – their experience in knowing what damages to ask for and how to talk to the insurance company can make a big difference in negotiating the highest car accident settlement possible, which can often pay for itself even after attorney fees, and save you a lot of time & stress in the process.