How to Settle With Insurance Companies for Car Injury Accidents

Demand more money from the insurance company. The first offer is always low.

Negotiating with insurance companies can be difficult but not impossible. In cases in which a large amount of money is at stake, it is worthwhile to hire an attorney to represent you. However, when damages are small it may not be cost effective to involve an attorney in the settlement process. The insurance company will likely to try to get you to accept the lowest offer possible. Fight back by negotiating and using your writing skills and persuasive abilities to win a better settlement.

Instructions

1. Calculate the cost of the accident, using all of your bills and expenses. Expenses usually include rental car costs, medical expenses already incurred as a result of the accident and lost wages. Additional costs include future lost wages, future medical expenses, and pain and suffering. Include damage to your car if your insurance company did not cover the expense or if the other driver's insurance company has not compensated you for damage to your vehicle. Calculate pain and suffering by multiplying your medical expenses by 0.5 if you recovered from the injury within two weeks, by 1.5 if the injury is ongoing and painful, and by two if the injury includes broken bones.

2. Multiply the medical expenses by two to get a solid monetary amount to seek from the insurance company for pain and suffefring. This is done so you have room for negotiation. It is better for this number to be too large than too small. You can bring your offer down in negotiations, but you can't bring it back up. Add the additional amount to your calculated expenses and use this number as your initial demand settlement amount.

3. 

   Don't be afraid to call your insurance company because your claims agent may be able to help you.

   Ask your insurance company about any liens or any expenses that your insurance covered that will need to be reimbursed by the settlement offer. Confirm with your insurance company if you have underinsured or underinsured motorist coverage and let your claims agent know you are going to attempt to negotiate a settlement.

4. Make a verbal offer to the insurance company by phone. The insurance company will likely reply with an initial offer. The initial offer is less than the value of your damages but typically involves little to no work by you. Accept this initial offer or send a demand letter. If your expenses are not above the policy limits for the other driver, you can expect these expenses to be paid in full if the other driver is 100 percent at fault. Expect to fight over the fault percentage if you and the other driver are at fault in the accident, and to fight over the amount you are seeking for pain and suffering.

5. Write a demand letter to the insurance company. Explain who is at fault, list all of your expenses and make your settlement demand. Include copies of the police report and all of your expenses and bills. Give the insurance company 30 days to reply.

6. 

   When deciding to take the offer, think about the cost of a lawsuit if you do not accept.

   Write and mail a counter offer to the insurance company or accept its offer. Explain in the letter of counter offer why the insurance company's offer does not compensate you for your damages and make another settlement demand amount lower than your original demand amount, but still above the value of your case. Respond to any issues raised by the insurance company as to why the offer is below your settlement demand amount. Give the insurance company 20 days to respond. Accept the new offer, hire an attorney to represent you in the case or file a lawsuit.

Tips & Warnings

• Do not wait until the last second to file a new counter offer. Once the statute of limitations is up you can not sue for the accident. Do not wait until the last second to hire an attorney. Your attorney generally needs time to review the case and check for conflicts.

• When you accept an insurance company's offer, expect to provide your tax information and sign a release form. Ask the insurance company to handle any liens or handle the liens yourself and send the amount due to your insurance companies after you have received your settlement.

• Always type your demand letter. You want to appear professional and organized.

• If the accident left you bruised, for full effect include a picture of your injuries and include it with the letter.

• Contact your local legal aid office to see if any free materials are available in your state.

• Remember your insurance companies. Health insurance, dental insurance, and any person or entity who has paid you money as a result of the accident will need to be reimbursed. Contact an attorney if you are on Medicaid or Medicare. Reimbursement for expenses can be incredibly complicated. It can be difficult to determine how much of your settlement must be paid to the government agency.

• Contact an attorney if there is a serious question of who is at fault in the accident or a large amount of expenses are involved, particularly for pain and suffering, which is difficult to calculate. You want to ensure that you are fully compensated.

Resources

• Injury Settlement Guide: Sample Demand Letter
• NOLO: Negotiating With an Insurance Company
• Free Advice: Auto Insurance Center