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How Do Attorneys Negotiate Personal Injury Settlements?

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How to Negotiate a Personal Injury Settlement

Dealing with a personal injury case? It can feel like you’re carrying the weight of the world, especially when the bills start stacking up. Finding a way to ease that financial strain might be at the top of your mind right now. Finding a way to ease that financial strain might be at the top of your mind right now. Consider this: a study by Nolo showed that having a lawyer on your side more than doubles your chances of securing a settlement or award.

This guide breaks down how their expertise transforms your case into a success story.

1. The Value of your Case

Understanding the value of a case isn’t merely about crunching numbers or making hasty estimates; rather, it involves a comprehensive examination of the client’s life, understanding the full extent of the injury, and assessing their damages accordingly.

Let’s break it down:

  • Medical expenses. This includes the cost of hospital stays, surgeries, medication, physical therapy, and any other medical treatments the client has undergone or will need in the future. But how do attorneys estimate future medical expenses? They consult with medical professionals who can provide a prognosis and outline the likely future medical needs. For example, if a client has suffered a spinal cord injury, he or she may need ongoing physical therapy and assistive devices. The cost of these future needs is factored into the settlement.
  • Lost wages: If a client has been unable to work due to an injury, the client has lost wages. But it’s not as simple as calculating the days of work missed. What if the client can no longer perform their previous job due to their injury? What if she can’t work at all? In such cases, the attorney will work with economists to calculate the loss of earning capacity. This involves comparing the client’s pre-injury and post-injury earning potential.
  • Other past and future losses. This can include a variety of damages, such as pain and suffering, emotional distress, and loss of enjoyment of life. These are more subjective and can be harder to quantify. But they are just as real and impactful as the financial losses. Attorneys often use certain formulas or industry standards to put a dollar value on these types of damages.

Imagine facing this battle without an attorney by your side – the risk of an insufficient settlement increases dramatically. The undervaluation of your case could lead to unpaid medical bills or inadequate compensation for lost wages, further exacerbating your difficulties. In contrast, skilled lawyers comprehend the diverse challenges that come with personal injury cases and can successfully negotiate a settlement that mirrors the impact of the injury on your life.

2. Proving Financial Liability: The Blame Game

The next step in the negotiation process is proving financial liability. This requires proof that the insured individual is at fault for the accident. A financial liability is an important part of the process that resembles a game of chess, where every move counts and strategy is key.

Negligence or Recklessness

To prove financial liability, attorneys must first establish that the insured party was negligent or reckless. They do this by gathering evidence, such as accident reports, witness statements, and photographs, to show that the insured party failed to exercise reasonable care that led to the accident. For instance, if a driver was texting while driving and caused an accident, this could be considered negligence. On the other hand, if a driver was speeding excessively in a school zone, this could be considered recklessness.

Referencing the Insurance Policy

Once negligence or recklessness is established, attorneys then reference the insured party’s insurance policy. This is a careful dance of legal language and policy details. What does the policy cover? What are the policy limits? Are there any exclusions or conditions that could affect the settlement? Attorneys scrutinize the policy to ensure they are seeking compensation within its terms.

Consider this: If you were trying to prove financial liability on your own, would you know how to gather and present evidence effectively? Would you understand the legal language in the insurance policy? Most people don’t. Attorneys know how to handle financial liability and can show the insured’s responsibility.

So, proving financial liability isn’t just about pointing fingers. It’s about demonstrating how the actions of the insured party led to the injury of the client. It’s about ensuring that those who cause harm are held accountable for their actions. And it’s about securing a fair and just settlement for the client.

3. Negotiating with the Insurance Company: The Art of Persuasion

Once the value of the case is determined, attorneys send a demand letter to the insurance company. This isn’t just a simple letter, but a carefully crafted document outlining the client’s damages and the compensation sought. Then, the insurance company may respond with a lower settlement offer. This is where the “art of persuasion” comes into play.

Attorneys use their negotiation skills to argue for a higher settlement by highlighting the following:

  1. The strength of the evidence;
  2. The severity of the client’s injuries, or
  3. The insured party’s clear liability.

It’s a back-and-forth dance, a test of wills. Can you imagine going toe-to-toe with an insurance company’s legal team? Having an attorney’s expertise and tenacity on your side is a huge advantage. A good insurance lawyer can help you make your case, and build a strong argument for why the insurance company should pay the full amount of your claim.

4. Proposing Legal Action: The Power of Pressure

The power of pressure in proposing legal action cannot be underestimated. When an insurance company refuses to negotiate or offers an unsatisfactory settlement, attorneys can exert the necessary pressure by proposing legal action. This strategic move not only showcases a willingness to fight for the client’s best interests but also highlights the potential consequences of a lawsuit for the insurance company.

First and foremost, a lawsuit can lead to significant financial costs for the insurance company. Legal fees, court costs, and allocating time and resources towards defending the case add up quickly. Moreover, if the court rules in favor of the plaintiff, there is also the risk of substantial payouts.

Besides financial repercussions, there is another factor at play: an insurance company‘s reputation. A lawsuit can bring unwanted attention that may potentially harm its image as a reliable and trustworthy provider in the eyes of consumers. Negative publicity can further result in loss of business as customers seek better companies that prioritize their needs.

Thus, when an attorney proposes legal action against an insurance company, it serves as a powerful tool for negotiation. It increases the perceived risks for the company and forces them to honestly evaluate how far they are willing to go to protect their bottom line while avoiding damage to their reputation. Consequently, this pressure could be instrumental in prompting them to reconsider their initial stance and ultimately offer a fair settlement that satisfies both parties involved.

5. Reviewing the Insurance Policy: Reading Between the Lines

When attorneys review the liable party’s insurance policies, they’re not just skimming the surface. They’re diving deep into the policy’s terms and conditions, looking for details that could impact the final settlement amount. But what exactly are they looking for?

Let’s dissect this further:

  • Policy Limits. Every insurance policy has a limit, which is the maximum amount the insurance company will pay for a claim. For example, if the policy limit is $100,000, that’s the maximum the insurance company will pay, regardless of the actual damages. So, if the client’s damages are $150,000, but the policy limit is $100,000, the attorney will need to consider other avenues for securing the full compensation.
  • Exclusions. Insurance policies often have exclusions, which are specific situations or circumstances that are not covered by the policy. For instance, an auto insurance policy might exclude coverage for accidents that occur when the insured is driving under the influence of alcohol. If such an exclusion applies to the case, it could significantly impact personal injury settlement amounts.

Lawyers possess an understanding of the intricacies of insurance policies. They formulate effective strategies for the case, and guide you through the complicated language to uphold your best interests. It entails ensuring that every aspect is taken into account, every avenue explored, and every opportunity for compensation pursued.

6. Applying Comparative or Contributory Negligence Laws: A Balancing Act

Personal injury attorneys keep a keen eye on the laws of comparative or contributory negligence as they can significantly impact the final settlement amount for a plaintiff. In some cases, the victim may share some fault for the accident. These laws can reduce or even eliminate the damages a plaintiff may be entitled to, depending on the jurisdiction and specifics of the case. It’s a balancing act, weighing the victim’s role in the accident against the potential compensation.

  • Comparative negligence refers to the concept that the plaintiff’s own negligence may have contributed to the harm caused. For example, in a car accident case, if the plaintiff was found to be 20% at fault for the incident, the final settlement award could be reduced by that percentage. So, if the settlement was initially $100,000, it would be reduced to $80,000 due to the plaintiff’s 20% contribution to the accident.
  • Contributory negligence, on the other hand, is a more extreme concept. In jurisdictions that follow this rule, if the plaintiff is found to be even 1% at fault, they may be barred from recovering any damages whatsoever. For instance, if a pedestrian crossed the road at a wrong place and got hit by a car driven negligently, the pedestrian might not be able to recover any damages because they contributed to his own injury by not crossing at an appropriate place.

When evaluating a case, personal injury attorneys face the difficult task of evaluating cases and determining the degree of fault. To ensure the best possible outcome, you should be upfront and honest with your attorney about your accident or anything surrounding your case. Any fact could tilt the balance between comparative or contributory negligence.

7. Working with Expert Witnesses: The Power of Proof

In the quest for justice, attorneys often call upon a powerful ally: expert witnesses.

Expert witnesses are professionals with specialized knowledge in a particular field. They could be medical professionals, accident reconstruction experts, economists, or life care planners. Each of these experts can provide key information on the extent of the client’s accident-related losses to help negotiate higher settlement amounts.

Let’s take a closer look:

  • Medical Professionals. Doctors, surgeons, or physical therapists can provide detailed information about the client’s injuries, the required treatments, and the prognosis. For instance, a medical expert could testify about the severity of a client’s spinal cord injury, the surgeries required, and the long-term physical therapy needed. This expert testimony can help paint a clear picture of the client’s medical needs, both now and in the future.
  • Accident Reconstruction Experts. These experts can recreate the accident scene, providing insights into how the accident occurred and who was at fault. For example, in a car accident case, an accident reconstruction expert could use skid marks, vehicle damage, and witness statements to recreate the accident, demonstrating that the other driver was at fault.
  • Economists. Economists can calculate the financial impact of the accident on the client’s life. They consider factors like lost wages, loss of earning capacity, and future medical costs. So, if a client named Robert can no longer work due to his injuries, an economist can calculate the income the client would have earned over their lifetime, contributing to a higher settlement demand.
  • Life Care Planners. These experts can outline the future care needs of the client, considering factors like ongoing medical treatments, home modifications, and assistive devices. This can be particularly impactful in cases involving severe injuries that require long-term care.

8. Gathering Official Documentation: The Paper Trail

In the pursuit of justice, official documentation stands as a potent tool for attorneys. These documents serve as concrete evidence as they provide a strong foundation for the case. Let’s explore the types of documents involved and their significance in contributing to the strength of the case at hand.

  1. Safety Training Brochures/Instruction Manuals. These materials serve as a standard for what safety practices or precautions should be in place. For instance, if a workplace accident occurs, these documents can be used to compare the actual practices against the suggested safety measures. If the employer did not follow the guidelines set out in the training manuals or brochures, this could be a concrete evidence of negligence, which provides a strong basis for the attorney’s argument.
    Example: If a worker was injured using a machine, and the safety training brochure didn’t mention how to safely operate the machine, this could be a sign of negligence.
  2. Medical Records. These records provide a detailed account of the injuries sustained by a person, the treatment administered, and the prognosis given by medical professionals. They provide the extent of the harm incurred, the direct link to the incident in question, and the potential long-term effects.
    Example: In a car accident case, the victim’s medical records can provide proof of injuries directly caused by the accident, their severity, and the cost of treatment, helping to establish the claim for compensation.
  3. Police Reports. A police report is an unbiased, third-party account of the incident. It often includes key details such as date, time, location, involved parties, witness statements, and sometimes, even the officer’s opinion about who might have been at fault. This report can strengthen the attorney’s case by providing an authoritative narrative of the incident.
    Example: In a slip-and-fall case, a police report might note that the site of the accident was poorly lit or the floor was wet without any warning signs, which corroborates the victim’s claim of negligence.

The Takeaway

The goal of the attorney is not just to secure compensation for their client, but to seek justice. By negotiating for higher settlements, attorneys show their clients that they deserve justice, which provides compassionate legal care by working to hold liable parties responsible.

So, the next time you wonder, “How do attorneys negotiate personal injury settlements?” Remember that it’s not an easy process to involve a combination of legal knowledge, negotiation skills, and a deep understanding of the client’s needs. You don’t want to go through a personal injury lawsuit alone. Hiring an attorney can significantly increase your chances of receiving a fair and just settlement.

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