QuestionQUESTION: I about the enter the settlement phase regarding an auto accident. The other driver has admitted 100% fault to me and her insurer. My medical bills are sitting at $3359.10 with $312.00 in lost wages. Is there a formula insurance companies use to determine what the initial offer would be? Numerous websites have given examples, but I want to make sure that I recognize and accept a fair offer. I was struck from behind while sitting at a read light sustaining neck pain/strain and have completed PT. Can you provide and overview of how this part of the process could work?
ANSWER: Hi Lisa,
Unfortunately, the normal "formula" is to lowball the settlement. Sad to say, but usually true. A settlement is a negotiation. You should never accept the first offer, or even the second offer. If the adjuster says they have reached their limit, you can be sure the manager can up that limit if you think the offer is unfair.
I am not advocating that people should receive more than they deserve, just what they deserve, and that takes some work.
As for formulas, those differ. Not sure that any of them are set in stone. As a general rule, with injuries that are not permanent, and where your losses are established (as seems to be your case) you can do a general calculation.
Your economic damages total $3671.10. Your non-economic damages are more difficult to calculate. They represent your pain and suffering and disruptions to your lifestyle - things like that. Depending on circumstances, you can arrive at an amount by multiplying the economic damages anywhere from 1.5 to 5 depending on the severity of the loss. So at the lowest possible estimate, your damages would compute to just over $5500.
For serious losses and permanent injuries, a competent personal injury attorney should be considered.
You can learn more about the claim settlement process from the free articles on my website. You can start here: http://solutionsforyourinsuranceclaim.com/Insurance-Claim-Settlement.html
Hope this helps.
Jane Pytel
http://SolutionsForYourInsuranceClaim.com
http://FloridaAutoInsuranceCentral.com
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QUESTION: Thank you Jane, the information was most helpful. When the initial offer is made, should I counter or just reject and let them come back with another offer. Is it better to ask for what you want and stick to that number or overstate your number and allow them to negotiate up and you come down toward what you truly wanted. I'm sorry if this is very elementary to anyone else, but I have never had to deal with anything like this and want to know what to expect. How do I know when they have reached their "final" offer and it it time to accept it or hire an attorney.
AnswerHi Lisa,
What I would suggest is that you arrive at an amount that you believe is fair. For example, are you certain not to have any more treatment? Is there a chance your injuries will cause you to lose more work? You have completed PT, but do your pains linger? Some soft tissue injuries can last a lifetime. It just depends. What has your doctor said about that?
If you are completely healed, then you need to determine what you think is fair for your inconvenience and any other out of pocket expenses.
You can count on the first offer to be low. If they offer say, $6000, is that fair? Or they may just offer you the exact amount of your medicals and lost wages. Is that fair?
I can't tell you what your number should be. What I can say with reasonable certainty is that the first offer will likely be low. That's the way it works. But, if it's close to what you think is fair, put your counter on the table, with perhaps a bit more to give you some leverage.
One mistake you do not want to make is to go so high that they completely reject it and force you to sue them. Probably not a good idea, especially if your injuries are not permanent.
Hope this helps. Good luck!
Jane Pytel
http://SolutionsForYourInsuranceClaim.com
http://FloridaAutoInsuranceCentral.com
