insurance adjuster holding out a pen and clipboard with a low settlement offer for a signature

How Do You Respond to a Low Settlement Offer? What is the Best Thing to Do?

Here’s a quick summary of the steps you and your attorney will follow when responding to a low settlement offer:

  1. Remain calm and analyze the offer even if you feel like the adjuster is trying to take advantage of you
  2. Ask questions to find out how the adjuster came to the conclusion that they did.
  3. Develop and plan your response (which is often called a counteroffer).
  4. Respond to the offer in writing.
  5. Do not settle your claim until you have healed from your injuries.

Serious car accident injuries may cause you to incur substantial medical bills. Accident victims often spend time in the hospital and/or have to miss work because of their injuries. Medical bills pile up, compounding the financial strain of going without a regular income temporarily, or even permanently.

When you add the emotional trauma of motor vehicle accident injuries on top of these economic costs, a low settlement offer for your personal injury claim from the at-fault party’s insurance company feels like nothing more than an insult.

Fortunately, you do not have to accept a low offer. You do not even have to talk to the at-fault party’s insurance adjuster. Instead, an experienced car accident injury attorney can negotiate with the insurance company on your behalf and get you the money you deserve for your injuries and losses.

Steps to Respond to a Low Settlement Offer

If you have been handling your claim by yourself up to this point, it is in your best interest to retain an attorney to assist you to get the advice and guidance you need.

If you are represented by a personal injury attorney for your injuries and they have already sent the initial demand letter for your claim, you may receive a low settlement offer from an insurance company, or the law firm representing the at-fault party. If this happens, you and your attorney should take the following steps to respond with a counteroffer.

Remain Calm

personal injury victim remaining claim while analyzing and rejecting a low settlement offer

Receiving a lowball settlement offer for your pain and suffering can feel insulting, but you owe it to yourself not to react emotionally to an initial offer.

Because you are under no obligation to speak with the insurer or insurance claims adjuster, it is best to remain professional and leave negotiations up to your attorney and remember that an initial offer is only a starting position for the negotiation.

Analyze the Offer

After receiving an offer, you and your attorney will analyze its contents. Your attorney will break down what is, and what is not, acceptable about it in the counteroffer.

Develop a Counteroffer

In addition to your formal rejection of the offer, your attorney will create a counteroffer based upon the amount you deserve in compensation for things like medical treatment, pain and suffering, and other harms you may have suffered.

Other factors that might be considered when developing a counter offer might be the limits of the available insurance policy, as well as the personal assets of the wrongdoer if the insurance policy limits are not enough to pay for the value of your injuries.

It is important to note that there may be many offers back and forth during the negotiations. You and your attorney will determine the minimum you are willing to accept for your claim. If negotiation stalls out, it may be best to take your claim to court since agreeing to a settlement is permanent.

personal injury attorney taking notes and drafting a formal written response to a low settlement offer

Respond in Writing

Your attorney will draft a formal response to the offer notifying the insurer that you are rejecting the offer. As the letter is being drafted, you or your attorney will likely point out faulty assumptions being made by the insurance company which it relied upon when making their initial offer so low.

The written response may include additional details left out of the demand letter about your personal injury case, proof of lost income, updated medical records and medical bills, details from police reports, and details about your non-economic damages such as how your pain and suffering has affected your life.

Don’t Settle Until You’ve Healed

If you have not fully healed from your injuries, you have no way of knowing exactly how much your medical bills, past and future income loss, and non-economic damages will be. You should never settle a claim without knowing what the full cost will be.

Factors to Consider when Countering a Personal Injury Settlement Offer

When you have been made a settlement offer, you get to decide if, when, and how to respond. An experienced auto accident settlement lawyer will provide you with legal advice on the factors that may influence your options and choices.

Let’s take a closer look at these considerations.

What Is a Good Settlement Offer Anyway?

A good settlement offer provides fair compensation for your injuries and losses. Settlement offers that would leave you in debt because of future medical expenses and lost wages are rarely, if ever, “good” or “fair” in any sense of those words.

In a car accident settlement negotiation, the insurance company and the victim often start off with widely differing views on what constitutes a fair and reasonable outcome. Both will likely have to give up a little ground to get a deal done. But not too much.

That is why it is so important to go into settlement negotiations with a clear picture of your current and future financial needs stemming from your accident and injuries. An experienced attorney can give you that picture. Skilled car accident injury lawyers evaluate injured clients’ claims to ensure that any counter to the insurer’s lowball offer seeks an amount that is more-than-enough to cover the client financially.

You Have Every Right to Reject a Bad Deal and Negotiate a Better One

personal injury accident victim holding out her hands and gesturing her refusal of a low settlement offer

An insurance company’s goal is to pay out the least amount possible on an accident injury claim. Experienced negotiators know that first offers are never best offers, particularly when an insurance company is on the other side of the negotiating table. Its first offer will virtually always be a lowball amount.

You have no obligation to accept it, and in most cases an experienced attorney will advise you against it.

If an insurance adjuster tries to contact you directly to make a lowball offer, it’s important for you to know that you are not obligated to speak with them. Even if you do choose to speak with them, you have no obligation to accept the low settlement amount the insurer dangles in front of you.

If you have already hired an experienced attorney to speak on your behalf, the claims adjuster should know better than to try and talk to you. If you haven’t yet, that’s ok. Simply decline to talk to the insurance adjuster and contact an experienced attorney right away.

What Happens if You Don’t Accept a Settlement?

In a word, nothing, at least not initially. Accepting a settlement is your choice, and yours alone.

The insurance company may put a time limit on how long you have to respond, trying to ratchet up the pressure you feel. In reality, however, the insurance company probably expects you to say “no” to its opening offer. That’s how negotiation works. It’s a back-and-forth.

Settlement negotiations commonly occur against the backdrop of a lawsuit your attorney has filed against the insurance company’s policyholder, who has legal liability to you for the harm you suffered in the accident.

As that lawsuit progresses, new facts may come out, and new legal considerations may become important. Settlement negotiations are always influenced by not only the facts that have occurred in your case, but also those that continue to be developed.

You may have multiple offers to either accept or reject over the course of a lawsuit. At each stage, your lawyer’s job is to evaluate the strengths and weaknesses of your case with the information then-available, and to advise you about the risks and benefits of accepting or rejecting the offer. Again, the decision is always yours at the end of the day.

The closer the parties get to the date set for trial, the more active settlement negotiations tend to get. If you ultimately decide not to accept whatever settlement offer is on the table, then your case may go to trial and will likely be decided by a judge and jury. Of course, the parties always have the option of returning to the negotiating table and settling, even after the trial has begun.

You Cannot Negotiate After You Accept a Settlement Offer

A settlement is a binding contract. Lawyers virtually always put that contract in writing in a “settlement agreement” that lays out the rights and responsibilities of both parties. In the typical settlement, you agree to accept money in exchange for terminating your lawsuit and/or giving up your legal rights against the other party.

Settlement agreements are one-shot-deals. Once the agreement is signed, there is no going back. If you later discover that you entered a settlement agreement that was too small to cover your financial needs, then it is too late to re-negotiate.

In other words, you need to be certain any settlement you agree to is a fair and reasonable one. Having a lawyer advise you and negotiate on your behalf helps to give you that certainty.

How a Personal Injury Lawyer Can Help You Negotiate a Settlement

two attorneys negotiating the terms of a personal injury settlement

Personal injury lawyers are trained negotiators that can advise you if, when, and how to settle your claim. They have the skill and experience to evaluate your current and future financial needs.

An experienced lawyer performs two critical functions in connection with a settlement negotiation:

The lawyer conducts a detailed analysis of the harm you have suffered, in order to calculate not just the out-of-pocket expenses your accident and injuries caused, but also the pain and suffering you endured, and the damage you sustained to your quality of life and relationships.

Translating those life difficulties to a reasonable dollar-value takes the skill of a seasoned attorney, and is essential to knowing what constitutes a “good” settlement offer.

The lawyer negotiates directly with insurance companies and defense lawyers, so that you do not have to.

By “speaking the language” of settlement negotiations, and by shielding you from insurance and defense lawyer tricks and tactics, the lawyer levels the playing field between you and the insurance company, which in turn increases your odds of receiving the money you deserve.

What Happens After You File a Personal Injury Lawsuit?

As we explained above, settlement negotiations and personal injury lawsuits typically happen simultaneously. They are not “either/or” propositions. Settlement negotiations that started before your lawyer filed a lawsuit will likely continue even after the suit is filed.

Filing a lawsuit might hit pause on the negotiations for a while, but they typically resume. After resuming, the negotiations may even accelerate as your trial date gets closer.

After a Low Settlement Offer—You Deserve More!

If you’ve received a low initial settlement offer from an insurance company after an accident, you don’t have to accept it and you don’t have to negotiate alone. Personal injury attorneys are skilled negotiators who put their experience and training to work for you to get you the compensation you deserve.

Trust a personal injury attorney to negotiate a fair settlement with the insurance company for your accident injuries and losses. Contact the skilled lawyers at The Miley Legal Group today online or at 304-745-2636 for a free consultation and case evaluation and to learn about how we help accident victims like you.

Author Bio

Tim Miley is the Founder of Miley Legal Accident Injury Lawyers, a West Virginia personal injury law firm he formed in 2006. With more than 30 years of experience in personal injury law, he is dedicated to representing clients in a wide range of personal injury cases, including car accidents, trucking accidents, motorcycle accidents, brain injuries, wrongful death, and other personal injury matters.

Tim received his Juris Doctor from Duquesne University and is a member of the West Virginia State Bar and the Harrison County Bar Association. He has helped his clients win more than $10 million in personal injury verdicts and settlements and has further served the people of West Virginia by filling legislative roles in the state’s government since 2004.

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