Avoiding Legal Trouble

Settlement Offer Response Basics: Understanding The Process

After suffering an injury due to someone's negligent actions, you have probably already reached out to a personal injury lawyer to file a personal injury claim. When you file that suit, it's going to start a lengthy process of negotiation and court dates. One of the first things that you will likely receive, after filing the suit, is a settlement offer from the other party. Here's what you need to know about that settlement letter and how to respond to it.

What Does The First Settlement Letter Mean?

That first settlement letter is standard practice when the insurance company deems that there is a legitimate case. The insurance company's goal is going to be to keep your case out of court because they cannot control how much money you might be awarded by the court at the end of the hearing.

Because the insurance company's goal is to spend as little as possible in your claim, that settlement offer is going to be lower than you likely deserve. Their hope is that you will agree to that amount in an effort to get the whole thing over with without a clear understanding of how much you actually deserve to get.

How Do You Respond To The Letter?

When you receive that first offer letter, you should discuss it with your attorney first and foremost. That way, you can get your attorney's legal opinion of the amount that's being offered. To adequately assess the validity of the offer, you need to consider the cost of your existing medical bills, the bills that are anticipated for future treatment, lost work time, and any other financial losses associated with the injury. Consider the fact that the amount should cover all of the above, especially if you are anticipating long-term treatment for your injury.

If the amount is not sufficient, it's time to respond to the letter. Present your counterargument in a clear, concise, and detailed manner. Explain your position on the offered amount and mention a specific amount that you think you are owed. Then, clarify exactly how you arrived at that number, including a breakdown of those medical costs and work pay loss.

What Happens If They Refuse Your Counter?

If the other party refuses your counteroffer, that means that your case will be going to court. Make sure that your attorney files the paperwork that clearly includes the amount you are seeking, including the explanation of why. Then, be prepared to go into court, present your case, and await the final determination.

As an alternative, you can request mediation before the case actually reaches the courts. During mediation, you will discuss the case and negotiate with a third party. That third party is responsible for encouraging settlement.