When you’ve been through an accident, receiving a quick settlement offer from an insurance company might seem like an answer to prayer. However, accepting that offer without thinking through all possible aspects can be a costly mistake.
Understanding Insurance Company Tactics
You have to understand that insurance companies are businesses looking to minimize their payouts and maximize their profits. When they offer a quick settlement, it’s often because they want to close the case before you fully realize the extent of your damages or injuries. These initial offers are typically lower than what you might be entitled to and may not cover all your future expenses related to the accident.
In some cases, they can be as low as 15 percent of what the insurance company believes the actual payout value should be. In other words, if you’re being offered a settlement of $10,000 right away, there’s a chance your claim is actually worth more like $60,000. (This difference isn’t always this magnified, but you can definitely bet that the first offer is going to be lower than the final offer.)
Insurance companies often employ psychological tactics to pressure claimants into settling quickly. They might imply that their first offer is the best you’ll get or that it’s a limited-time deal. The stress and uncertainty following an accident can make these offers seem more appealing, pushing you to settle before you have a complete picture of the situation. But whatever you do, don’t be misled into believing that you have to accept a settlement offer “right now” or lose it. Listen to what they have to say and then politely end the conversation. That number will still be on the table the next time you talk (and it will probably be a little larger).
Assessing the Full Extent of Damages
Some injuries, particularly those related to the spine, neck, or head, can have delayed symptoms. What seems like a minor injury at first could turn into a long-term or chronic condition requiring ongoing medical treatment. This is why you don’t want to settle quickly.
Accepting a quick settlement means you may be unable to claim additional compensation later for these unfolding medical issues. You need to allow enough time to pass so that medical professionals can accurately diagnose your injuries and predict your recovery needs, ensuring any settlement will cover your current and future medical expenses, lost wages, and other related costs.
The Value of Good Legal Advice
Consulting with a legal professional before accepting a settlement offer can significantly impact the outcome of your claim. Personal injury lawyers understand the tactics used by insurance companies and are skilled in negotiating fair settlements. They can help you navigate the complex legal landscape, ensuring that all potential damages are considered, including non-economic damages like pain and suffering, which are often overlooked in initial settlement offers.
“In the legal arena, insurance companies recognize the distinction between those who settle quickly and those who ardently fight for the rightful compensation their clients deserve,” attorney Steve Foley says.
A lawyer can also handle all communications with the insurance company, relieving you of the stress and allowing you to focus on your recovery. They will advocate on your behalf, ensuring that any settlement reflects the true value of your claim and is in your best interest.
Negotiating for a Better Settlement
Having a lawyer negotiate your settlement can lead to a much higher payout than you might secure on your own. Experienced attorneys know how to build a strong case, using evidence like medical records, expert testimony, and documentation of lost earnings to justify a higher settlement amount. They also bring the threat of litigation, which can motivate insurance companies to offer a fair settlement to avoid the costs and risks of going to court.
In many cases, the increase in settlement amount obtained with a lawyer’s help more than covers their fees, making legal representation a wise investment. (And beyond the actual dollars and cents, a lawyer significantly reduces your stress.)
Putting it All Together
At the end of the day, rushing into a settlement rarely works well for a car accident victim. It almost always favors the insurance companies (which is why they’re so quick to offer a settlement figure). By being patient and getting sound legal counsel, you can improve your chances of enjoying a favorable outcome.
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