If your claim is against your own insurance company, read about Your Car Insurance Policy.
OK, let’s talk negotiating . . .
The Car Accident Insurance Claim Process
To be successful in negotiating your car accident claims, you must understand the process.
Who Are You Negotiating With
First, you have to know whom you are negotiating with. Is your claim against your own insurance company or against another company that insures the driver who caused your accident?
If the claim is against your company, the terms of Your Insurance Policy are critical. There are probably rules for what you can recover, whether there are deductibles, what information you must provide and how you dispute their handling of the claim.
On the other hand, claims against another insurance company aren’t governed by these types of contract rules for the obvious reason that they are someone else’s insurance company, not yours, and you have not entered into a contract with them.
What Type Of Car Accident Claim Are You Negotiating
Different rules apply.
Normally, car damage claims are easier to negotiate then injury claims. The insurance companies tend to hassle you less.
Injury claims are more difficult to negotiate. There are many reasons for this, but one of the main ones is that a primary component of your injury claim, pain and suffering, is completely subjective. You and the insurance company often will have dramatically different views of what is fair compensation for your pain and suffering.
The rest of this article will focus on the more difficult subject of negotiating injury claims that result from car accidents.
When Do You Begin To Negotiate Your Car Accident Injury Claim
“Not too soon” means you should not try to settle you injury claim until you have recovered from your injuries and, therefore, know the full extent of your claim.
To negotiate your car accident insurance claim, you will have to tell a story – the story of your accident. You want to be able to explain how the accident happened, who caused it and what injuries and other harms it caused. You won’t know the full extent of the harm until you have recovered and returned to your pre-accident health.
You only get one injury settlement. If, for example, you settle your injury claim on a Monday and learn on Tuesday that your injuries are worse than you thought, that you will need an operation and will be out of work for 3 months and will not fully recover for a year, do you know how much more you can recover because of the new information?
That’s right. Nothing.
Don’t let this happen to you. Do not begin negotiations until you are fully recovered. If your doctor says you won’t fully recover, that you will have permanent consequences of your injuries, you can proceed once your doctor tells you that you have reached “maximum medical improvement.” When you get to that point, you know as much as possible about “your story” that you will tell when you make your injury claim.
On the other hand, you cannot wait too long to make your claim
There are deadlines called Statutes of Limitations in each state. Before the deadline, you must either settle your claim or file a case in court. (You don’t have to complete the case before the deadline, you just have to file it.)
On top of that, if your claim is against a government, there is even a shorter – perhaps much shorter – deadline for putting them on notice of your claim.
These deadlines are unforgiving, so please make sure you know them and comply with them.
How Do You Begin The Negotiation Of Your Car Accident Injury Claim
If you have given the insurance company you are dealing with written authorization to get your medical records and employment records – something you should not do! – the insurance company may contact you and start negotiations by making a settlement offer.
However, the more common way to begin negotiations, and the better way, is for you to send a demand letter or a settlement letter (two different names for the same thing) to the insurance company.
The demand letter may be the most important part of the claims settlement process. If it is not, the negotiations are.
How Long Do Car Accident Injury Claim Negotiations Take
It depends. (I can’t help it. After all, I’m a lawyer whose is trained to be precise.)
If you sent an organized demand letter and attached all of the relevant documents, the claim negotiation process could be as simple as a few telephone conversations with the insurance adjuster over a week.
On the other hand, negotiations can drag on for up to 8 weeks, or so. If there is no resolution by then, it is not likely that you will ever settle your claim.
If negotiations are dragging on longer than you want, here are some things you can do to speed up the negotiations:
- Follow up with the adjuster regularly. Be politely persistent. Don’t let them ignore your file.
- If the adjuster is the problem, ask to speak with a supervisor. Sometimes, this can get the negotiations moving.
- If the insurance company is not acting in good faith, file a complaint with your state’s insurance commissioner. Believe it or not, insurance companies care – at least a little – about claims of bad faith.
- Hire a lawyer. Many car accident lawyers are effective negotiators. Some are masterful. And a lawyer has a weapon you probably don’t have. The lawyer has alternatives. S/he can easily file a lawsuit if the settlement negotiations are going nowhere.
15 Tips For Negotiating Car Accident Insurance Claims
Based on more than 25 years negotiating car accident insurance claims, these are my top 15 tips for negotiating your injury claim:
- Do not start too soon. I already talked about this. Wait until you know the whole story of your accident. Evaluating your claim before then is like predicting the final score of a baseball game in the 5th inning.
- Have a goal. Know what you are trying to achieve. When you are evaluating your claim and preparing your demand letter, decide the minimum figure you would take to settle your claim. You cannot hit your target if you don’t know what it is.
- Demand more than you will accept. There is no way to avoid the give-and-take, back-and-forth negotiation process. So ask for more than you will accept. I recommend that you ask for somewhere between an extra 25% and an extra 100%.
If you ask for more than that, you brand yourself as unrealistic or clueless.
If you ask for too little . . . you’ll get too little.
- Do not give a recorded statement. Although the insurance adjuster will imply that it is routine, and even required, you do not have to give a recorded statement.
Don’t. From speaking with their policyholder, they already know their driver caused the accident, so they don’t need a statement from you to establish responsibility. They are just hunting for something they can use against you in the negotiations or, if your case goes there, in court.
- Do not sign medical or employment authorizations for the insurance company.
Sure, they have to know the facts to evaluate what you are entitled to recover, and that includes medical bills, medical records and lost income statements. But you should control the process of gathering this information and submitting it to the insurance company.
- Do not let the insurance company doctor examine you. The insurance company might ask you to submit to what they call an IME, which stands for Independent Medical Examination. What a joke. There is nothing independent about this type of medical examination. It is paid for by the insurance company and done by a doctor that the insurance company employs frequently for this purpose. Do you think it is likely that the doctor will jeopardize a stream of income – that can be as much as $1 million dollars per year – by giving the insurance company opinions they do not want?
- Know the deadlines. Do not let the statute of limitations deadline bar your claim.
- Listen to the insurance adjuster’s arguments and give them the weight they deserve.
Even though you should enter the negotiations with a goal, with an idea of the minimum amount you will accept, you should revise your position if the adjuster makes good points when you discuss the case with her.
- Ask the adjuster to justify any offer that you feel is low. Ask him to explain how they arrived at that offer. Then, after reflecting on their arguments, either call them back or write a letter to them rebutting their arguments.
- Do not forget about future damages. If your doctor says you have a permanent injury or will require future treatment, you are entitled to be compensated for those future losses. This gets a little tricky. I recommend that you at least consult with a lawyer about how you prove future damages.
- Know who gets part of your settlement. For example, you may have to repay your health insurance company for the medical bills they paid. In fact, in some states, the insurance company will pay them directly out of your settlement and send you the balance. To fairly evaluate your position, you have to know “the bottom line,” that is how much you will actually receive.
- Be honest and straight forward. Some people think that negotiations are a game that is won by the person who is best at deceiving an opponent.
I disagree. My experience teaches me that the best negotiators are honest, reasonable and above board.
Besides, even if you were inclined to shade the truth by, for example, not disclosing an earlier injury to the same part of your body injured in your accident, there is a good chance the actual facts will come out and damage your credibility, perhaps even destroy your claim.
- Do not get angry. You may want to get upset when the insurance adjuster states, or implies, that you were not really injured or were not injured as seriously as you know you were.
But don’t get angry. Counter their nonsense by using facts. Emphasize your best arguments. These could be such things as the fact it was a serious collision, the other driver had been drinking, you had obviously painful injuries, you lost a great deal of income, etc.
- Help the adjuster help you. Stand your ground and be assertive. But, as much as possible, instead of an adversarial relationship, try to establish a tone of two people working together to solve a common problem, how to fairly settle your injury claim.
The best adjusters are professionals doing a job. They want to settle cases. However, they are responsible to superiors and they do not want to be criticized for being too soft. Learn the types of things the insurance company considers when they evaluate a claim and give the adjuster the evidence she needs to give you the highest possible offer.
- Continue back-and-forth negotiations until you have the insurance company’s best offer, then decide whether to accept it.
Even if negotiations go higher than you “bottom line,” keep negotiating. Continue negotiating until the insurance company stops increasing its offer. Give them several more opportunities to raise their offer. If they still do not, you probably have received their highest offer.
If you want to be reasonably sure you have their highest offer, ask them! Ask them questions like these: “Is this the highest offer you will ever make?” “Is this a take-it-or-leave-it offer?” “If I do not accept this offer, should I simply hire a lawyer and file in court without calling you back?”
If the adjuster hesitates or quibbles, they probably have more money they can offer. Keep negotiating.
Once you believe you have their highest offer, evaluate it and decide whether to accept it. If it is higher than your “bottom line,” you will probably accept it. If it is far lower than your minimum acceptable settlement, you will probably reject it and go to court, either by yourself or with a car accident lawyer . If the offer is close to your goal, you will have to decide based on such things as how much more you think you can recover in court, how much time the lawsuit will take and how comfortable you are with the uncertainty of what will be decided in court.
If you are going to negotiate your own car accident insurance claims, do the job right. Get the information you need, as well as all the necessary forms and checklists in my ebook, The Car Accident Claims Kit SECOND EDITION. My book costs about what you pay for lunch for two and it comes with a 60-day money-back guarantee. So you have nothing to lose by trying it.