What is a Reasonable Car Accident Settlement Offer?
A reasonable car accident settlement is one that helps restore the victim to the physical and financial states they were in before the accident occurred. You recoup both economic and non-economic damages, and any future care is provided for. Every situation is different, so a reasonable settlement depends on the circumstances of your accident. However, these guidelines will inform and prepare you for how to identify a good settlement offer for a car accident.
Deciphering the Value of a Settlement Offer
A reasonable car accident settlement offer covers all current damages and future costs. Understanding the settlement negotiation process lets you set reasonable expectations up front, know when to push back on a lowball offer, and ultimately, know what a good settlement offer for your car accident is and when you should accept. The process includes an initial offer, counteroffers, and negotiation between you (and your lawyer if you choose to retain one) and the insurance agency’s adjuster.
You must get the timing right, know the value of your claim, establish your goals for compensation, be ready to analyze an offer, and then decide what a reasonable car accident settlement offer is. Then, you can pursue a reasonable compensation for your claim.
Know that insurance companies are legally responsible for providing compensation when their covered party causes an accident. This means they are obligated to pay you, and, except in extremely rare situations, you should not accept the first offer you are extended.
Components of a Reasonable Settlement Offer
You need comprehensive evidence supporting your claim’s value, as well as the patience and persistence to negotiate. The process includes determining the value of your claim, providing supporting evidence, and understanding how your claim is valued by insurers. Timing is important. You need to wait until you have recovered to get a settlement, allowing you to have the final costs related to the accident to present to the insurance company.
Maximum Medical Improvement (MMI) defines the point at which your healing process has plateaued, and the healthcare provider determines you’ve recovered as much as you’re going to. In other words, even with additional treatment, the chances of improving further are limited.
It’s important to wait until you reach this point to settle as it dictates the quality of life moving forward, the potential for lost wages in the future, and overall medical costs. Accepting an offer before this point is reached can result in a settlement that does not cover all your medical bills or accurately considers pain and suffering.
Economic Damages
Economic repairs will include any financial impact due to the accident, which will be paid out of pocket. Economic costs include:
- Vehicle Repairs: The cost to repair the damage caused by collision or the vehicle’s value if it was totaled.
- Help at Home During Recovery: During recovery, you may need help with simple tasks and have to hire someone to help with daily living.
- Alternative Transportation: You need to get to and from medical appointments, and you may not have a car or be able to drive.
- Medical Expenses: Anything related to medical treatment like clinical visits, physical therapy, and home medical equipment.
- Cost of Future Treatment: Injuries resulting in permanent disability or need for ongoing treatment need to be provided for in the settlement.
- Lost Wages: You’re going to miss some work for treatment, impacting your wages. The at-fault party is accountable for this. Future lost wages or missed job opportunities due to your diminished capacity need to be covered, too.
Non-Economic Damages
Non-economic damages attempt to compensate for the intangible things that have been affected by your accident. Usually, this is done by taking the economic damages and applying a “pain and suffering multiplier” to get a total value. The multiplier will be a higher number when the accident is more severe, you end up permanently impaired, there is a loss of quality of life, or the other driver was driving recklessly or under the influence. The more the accident impacts you, the higher the multiplier.
Comprehensive Evidence
The need for documentation showing the car accident’s impact cannot be stressed enough. Without this, a reasonable settlement for your car accident will be complicated. Comprehensive evidence means you have all the records showing the financial impacts of the car accident and the less tangible impacts, like how your mental health has been affected.
Keep every receipt, every medical transcript, and all the other related paperwork you accumulate. You want to ensure you include medical documents, police reports, photos of the accident scene, witness statements, and anything else to prove your settlement’s value.
Consider keeping a journal of how the injuries or stress have impacted your life. This can help show the value of emotional trauma or pain and suffering. If you seek compensation for emotional trauma, a mental health professional should be part of medical treatment and included with evidence.
You must prove to the insurance adjuster that you’re credible and that the claim is valid. The best way to do this is through adequate evidence. The insurance company uses documentation to evaluate your claim, and it’s a lot harder for them to justify a low settlement offer when you have receipts showing that you’ve already spent more than they’re offering.
What’s Your Car Accident Settlement Worth?
Evaluating and Negotiating Your Settlement Offer
Understanding the value of each different part that makes up a car accident settlement is essential so you know what a reasonable settlement is for your situation. This number allows you to establish a range you believe to be acceptable for compensation by setting a high number and a low number for the amount you’re willing to accept as reasonable for your car accident claim.
Assessing The Initial Offer and the Beginning of Negotiation
At some point, you will either send a demand letter to the insurance company, or they will extend an offer to you first. They are hoping you take the first offer. Accepting the first offer from an insurance company is almost always a bad idea. You are allowed to decline politely, and this means insurance can also decline your initial demands.
Whenever you get an offer from an insurance company, consider it carefully. Make sure that it adequately covers all the financials impacted. If the settlement doesn’t do this, it is unreasonable, and you shouldn’t accept it.
Whether you send your request first or the insurance reaches out, this is where negotiation begins. You must leverage the evidence to show the adjuster you are asking for a reasonable amount and that you will not give in to their strategies or allow them to pressure you. This is the best way to show you mean business as you negotiate for a reasonable settlement amount.
Negotiate for a Higher Settlement
When you negotiate for a higher settlement, you can try to get more money from an insurance company. A few key strategies to help achieve the desired results will help.
If the insurance turns down the amount you request in a demand letter, you should ask them to explain their decision. They are required to if you ask. Use this information to reshape your augment to address the weaknesses. Then, you can extend the reworked letter and see what happens.
You counter offer any offer they send your way instead of outright declining it. Most cases will settle through negotiation, so focus on this when you want to ensure you get a reasonable settlement from your accident. Again, solid evidence proving the other driver’s liability and documenting all your losses is incredibly important here.
Red Flags in Settlement Offers and How to Respond
Knowing how to spot red flags will allow you to remain one step ahead of the insurance and avoid accepting an offer without a reasonable car accident settlement amount.
Insurance Tactics You Need to Know
Insurance companies will use specific tactics to get you to take less than what is reasonable for your settlement. This is easy to see if you know what you’re looking for:
Get you to accept a low offer by giving you an expiration date, hoping you’ll be scared and take the settlement.
Send you a low offer right away so you think that is all the case is worth.
Find social media photos showing your quality of life isn’t affected and use them to downplay an injury.
Claim your injury isn’t as severe as you say to discredit your evidence and make the whole settlement worth less money.
Attempt to trick you into admitting guilt or saying something contradictory to your claim to make you appear dishonest.
If you see anything that looks or feels a little underhanded, you should be wary. Protect yourself from insurance, and you are more likely to get the settlement you need.
When You Need a Professional Opinion
Sometimes, you need the help of a professional. When you feel like the insurance company isn’t even trying to negotiate with you or keeps using tactics that you don’t know how to counter, a legal professional can provide you with the knowledge, experience, and tenacity needed to get the car accident settlement you need to reasonably cover the damage.
Attorneys know the tactics insurance uses. They know the laws and their applications, and they should also have your best interests in mind. Feel free to get an attorney at any point in this process – most offer free consultations and only charge a fee if they’re able to secure you a reasonable settlement. Legal procedures can be complex, so if you feel apprehensive or simply want an expert opinion, hiring a lawyer may help you get a bigger settlement for your car accident.
Securing a Fair Settlement
The settlement offer you want to accept will include compensation for all economic and non-economic losses caused by your car accident. To get there, know the claim’s value and have a set goal for your settlement amount. You need to advocate for what you deserve, which is easiest when you make informed decisions about the offers you receive.
If the whole thing has left you overwhelmed, seeking the help of a lawyer can be an invaluable asset. With knowledge and evidence, you can get the reasonable car accident settlement you’re owed.