Negotiating a settlement agreement is the part of your case where there is finality, understanding, and closure. In some cases, this process is relatively seamless. Our attorneys will communicate with the insurance company representing the tortfeasor who caused you harm and hammer out a deal over one phone conversation. While this is not the norm, it does represent one end of the spectrum. On the other end of the spectrum, we communicate with the insurance company over a few weeks. After understanding that we cannot come to fair terms to represent your injuries, we file suit against their insured. At this point, we must wait several months to get into court. Once your court date approaches, the insurance company will sometimes offer a better settlement. They save money by not paying for defense counsel and will avoid it when they can.
Whether dealing with an insurance company or the opposing party’s legal team, an attorney’s strategy in negotiations can significantly affect the settlement amount. In most cases, we deal with negotiation specialists who are not actual attorneys from the insurance company. They handle negotiation in the typical auto accident case. Some adjusters understand tort law relatively well, while others have less experience and must be corrected. Notably, if you encounter an adjuster with less experience, they may convince a layperson that their view is correct when their claims are, in fact, baseless. Insurers tend to put their best on these claims for more valuable cases. They either put their top-level negotiators or experienced attorneys. Depending on the insurer’s size, some insurance providers will contract out to a third-party law firm.
Understanding the Settlement Process
In most cases, once you are done with your medical treatment or have reached maximum medical improvement and are given a permanency rating, we send a demand letter to the insurer. The insurance provider then takes four to six weeks to evaluate our demand and prepare to negotiate a settlement. Once they have completed their evaluation, we begin settlement discussions. This typically takes a couple of weeks. We make our case over the phone, provide a demand amount, and the insurer gives a settlement offer. The first few offers are almost all lousy. However, they know that we must convey our offer to you. They count on this as they know some claimants desperately need financial assistance after their injury and may jump at the money despite it not fairly representing their injuries.
It is our job to explain that it is a poor offer and that the insurer will increase the amount on the table if we hang in there. Generally, the longer you are willing to sit while we negotiate, the higher the settlement will be. We understand full well that some claimants need financial assistance quickly. The plaintiff has often been out of work for weeks from injury. It is not easy to rely on savings for that long. However, it is best to think longer term, as just a week or two can sometimes double the size of the settlement.
Mediations
Additionally, more complex cases can require mediation to get a deal done. While this is still faster than going to trial, it is not fast. It can take a couple of months from when we schedule a mediation to wait for the day of the mediation to arrive. However, these tend to be effective alternative dispute resolution methods that allow us to resolve your case without the expense of a trial.
The Role of Evidence in Settlement Negotiations
Even when you know the other driver caused your accident, proving that to a jury is another story. Our lawyers negotiate settlements by demonstrating to the insurer how effective our evidence would be in a trial. Much of a settlement involves discussing how a trial would go if we cannot settle. The belief instilled in the other side that we would be effective at trial is compelling leverage in a settlement negotiation. If we lack evidence, the defense team knows we may have less success at trial. Conversely, if we have sufficient and compelling evidence, that is leverage in a negotiation to receive a larger offer.
Of course, an experienced personal injury attorney like the ones at Gelb & Gelb knows when to bluff and how to leverage the evidence we do have to get the best possible settlement offer for our clients.
Strategies Used by Lawyers During Negotiations
Our attorneys employ countless strategies during a settlement negotiation. While it is beyond the scope of this blog post, we will highlight one key strategy that has collectively earned clients far more in compensation than their case is probably worth. Almost all personal injury attorneys send a demand letter to the insurance company outlining the facts of the case, the injuries sustained, and the compensation sought. Many attorneys will include the compensation sought and detail why they think this is important. In our experience speaking with other injury attorneys, this does little to affect how the insurance companies value your claim. They use computers and algorithms and pay little attention to what we believe the value is worth. Moreover, once we begin the negotiation, we still tell them what we believe it is worth.
The strategy we refer to here is letting the other party make the first move. Above, we referred to insurance adjusters who do not always know how to value a claim properly. In some instances, this must be corrected to compensate our client correctly. However, in other instances, they wildly overvalue a claim. After handling over 10,000 personal injury cases in Washington, DC, and Maryland, we know precisely what a case is worth. Although, not all insurance negotiators have this same level of experience. Sometimes, they offer far more than your case is worth.
Of course, we will still push them to get you as much compensation as possible to reflect the seriousness of your injuries. However, if we had come in with a lower number based on your case’s actual value, you may have received less compensation. That is the strategy many injury attorneys employ, which we have learned is a mistake.
Common Challenges in Reaching a Settlement
Reaching a settlement agreement with an insurance company can be challenging. Below, we list some of the most common challenges we have faced.
- Disagreement over liability: This may arise due to a lack of evidence or the insurance company’s understanding of relevant tort law.
- Dispute over compensation amount: This is a natural part of any negotiation and agreement. Our goal is to maximize compensation for your injuries, while the defense team’s goal wholly contradicts ours. Naturally, there are biases at play.
- Insurance company tactics: Insurance companies may delay negotiations or offer quick, low settlements to pressure the injured party into accepting less.
- Timing and Delays: Negotiations can be drawn out due to back-and-forth discussions, medical reviews, or disagreements over settlement terms.
Contact Our Office Today
If you are hurt and seek a fair settlement, it is best to get experienced representation for any settlement negotiation. Our attorneys have successfully recovered over $150 million for our clients. We understand insurance companies’ tactics and know how to counter these tactics to deliver the best results for your case.
Call our office today for a free consultation and case evaluation at (202) 331-7227.
