How to Negotiate an Injury Settlement
Settlement negotiations involving injury claims should begin with a demand letter. The letter forms the basis for all subsequent discussions and agreements. After providing a letter, always maintain a polite yet formal relationship with insurance adjusters and adverse parties. Volunteering a recorded statement is a show of good faith and builds credibility. Provide full disclosure and documentation. Valuing claims is an art rather than science (See Reference 1). Recent settlements and court verdicts for similar injury claims in your county of residence are the best indication of value.
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Instructions
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Preparing a Demand Letter
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1
Prepare a demand letter explaining your theory of liability briefly. The letter should allege negligence, gross recklessness, intentional injury, or a statutory violation as a basis for liability. You must prove a breach of a legal duty to recover damages.
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2
Include documentation of liability for injury claims if available. Accident reports, police citations, and third-party witness statements are the best proof of liability. Ask witnesses to sign statements. A statement may be hand-written and does not require a notary seal.
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3
Explain damages briefly. List damages separately and provide a dollar amount for each item. For example, you may potentially recover damages for vehicle repairs, property damage, lost wages, medical expenses, physical pain, mental suffering, permanent disability and punitive damages. The basis for liability determines recoverable damages for each claim.
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4
Include documentation of damages in injury claims. Invoices, professional estimates, photographs, signed letters and physician reports are the best proof of damages.
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5
Demand a specific settlement amount. Your local courthouse provides a rich source of information for reviewing verdicts involving similar claims. Allow room to negotiate when making an initial demand. Insurance adjusters rarely agree to the first offer.
Discussing Settlement
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6
Call the adjuster to verify receipt of your demand letter and initiate settlement negotiations. Find out quickly if the adjuster disputes liability, damages or both.
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7
Explore areas of agreement and dispute. Try to narrow areas of dispute for future discussions. Provide additional documentation if necessary to support your claim. Do not accept the first offer.
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8
Compromise if necessary. You may reduce your settlement demand at any time. The best settlement negotiations are the result of preparation, persistence and familiarity with settlement values.
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Reduce your demand by small increments and call often. A new demand letter is not necessary.
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10
Discuss payment terms before settling. You must know how and when you will receive payment.
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Tips & Warnings
Insurance companies research your history of prior claims and medical treatment. Adjusters frequently test claimants throughout settlement negotiations with questions although they already know the answers. They are evaluating your credibility. Workers' compensation claims do not require proof of fault. Because of the easier standard for recovery, state workmers' compensation acts limit claim value. Workers' compensation claims do not include property damage, pain, suffering or punitive damages.
