About Auto Insurance Settlements
After an auto accident, involved drivers should immediately prepare for the inevitable auto insurance claims by assessing bodily injuries to themselves and their passengers and the damage to their vehicle. However, even with that essential information gathered at the scene, claims require additional steps before authorities can determine liability and insurers can settle with policyholders and claimants.
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Function
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Auto insurance settlements allow individuals involved in a vehicular accident to receive financial reimbursement for related expenses, usually medical costs for treating injuries and funds to repair or replace a damaged vehicle. Although statistics indicate that over 90 percent of auto insurance claims end with a settlement agreement, if negotiations fail, a more time-consuming and expensive lawsuit could develop.
Claims
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Auto insurance claims filed with a negligent driver's insurance company unfold in several stages. After assessing all bodily injuries and property damage, preferably with supporting documentation such as photographs and bills, the claimant needs formal documentation, such as a police report, to verify that she is not at fault. If the liable party's insurer doesn't contact the claimant first with an opening settlement offer, the claimant should compose and send the company a demand letter that details her accident-related expenses, complete with supporting documents.
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Negotiations
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Insurance companies authorize claims adjusters to pay claimants a specific range of money, such as $5,000 to $7,500, depending on the facts and gravity of the accident. To save money, the initial settlement amount adjusters offer is always at the lower end of their authorized range.
Expected negotiations begin when the claimant counter-demands for an amount closer to their actual expenses and damages, after which the process can continue until the adjuster reaches the point at which he will make no higher counter-offer. If the parties cannot progress past such an impasse, rather than give in, the claimant should seek an attorney to facilitate the negotiations on their behalf.
Time Frame
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While the length of auto insurance settlement negotiations vary, most states allow claimants one year or more to either settle their claim or file a lawsuit. Claimants should still contact assigned adjusters regularly while negotiations are underway to ensure their claim receives proper attention. If an adjuster doesn't respond to communications in a timely manner, consult his supervisor for assistance. Sometimes adjusters are simply overworked or don't have the authority to speed up things.
Considerations
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The smaller an accident and/or the demand amount, the faster and easier it typically is to reach an auto insurance settlement agreement with the negligent party's insurance company. Even so, a claimant should consult with an attorney who specializes in auto accidents before signing the official release and waiver form that legally protects the insurer from any further demands by the claimant related to the same accident.
Signing the document formally ends the negotiations and results in the insurer releasing payment in the agreed-upon amount. However, it also prevents the claimant from pursuing future claims against the company, even if an unforeseeable injury or situation arises.
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