This article is not intended to discourage the reader. Actually, quite the contrary. The premise of this article is that by not conforming to the expectations of the insurance company, you will be in a better position to control the ultimate outcome of your claim. To fully appreciate this logic, you should first understand what the insurance company expects you to and why they are so certain you will do it.
In Colorado, less than half of one percent (.05%) of all injury related accident claims actually end up in trial. Everything else settles. The natural question is whether these settlements are fair and adequate to compensate the injury victims? After all, they must be tempting enough that most people are choosing to take what is being offered by the insurance company, right? Actually, the answer is usually no.
Settlements by the insurance companies on average do not fully pay back even the medical expenses, let alone paying anything toward future medical needs, permanent physical injury or pain and suffering. In fact, most injury victims report that after settlement they are still in debt for having gone through the ordeal of the injury accident. So, if settlements with the insurance companies are not lucrative, why do so many people settle instead of taking their shot and going to trial?
A) Why Their Offers Are So Low, and Why They Know You Will Settle:
1) MOST INJURED PEOPLE DO NOT HIRE A LAWYER:
Ok, before you stop reading and tell yourself this article is designed simply to convince you that you need to hire a lawyer to resolve every injury; please keep reading. That is not my point at all. You do not need to hire an attorney to settle your case. That is a matter of personal preference.
However, not hiring an attorney Red Flags to the insurance company that you are not prepared to file a lawsuit. It further projects that you are ill-prepared to take your case, if a settlement offer is inadequate, to trial. In fact, not hiring an attorney virtually assures the insurance company that you will have to take their final offer. You simply don't have any ammo.
Please note that we are often hired by clients, late into their case, often after they receive a woefully inadequate settlement offer. But, those people who hire lawyers late are well in the minority. By that time, most are worn down with increasing expenses and unpaid bills pressuring them to settle immediately. In these cases, people settle for what the insurance company says is their "final offer."
2) WEAK LAWYERS:
I'm not personally attacking other lawyers. But, often lawyers who dabble a little in representing injury victims, while juggling the demands of other clients like divorce cases, criminal cases, and perhaps business related cases, generally lack focus to really stop everything in their professional life, and proceed to trial on a car crash injury case. They are not weak if they focus. They are weak because their business model will not allow them to take your case to trial.
The problem for the injury victim is that the insurance company treats weak lawyers all the same. A lawyer who is incapable of finding the court house, is given no less respect than and attorney who knows how to try a case, but won't try your case. Weak is weak.
If the insurance company knows your lawyer won't go to trial, they know you will ultimately have to settle for whatever low-ball offer they decide to stick at.
While some general practice lawyers are tenacious in the courtroom, most are not. The insurance company knows who will go to trial and who will not. We believe that makes a difference in how insurance companies treat the clients of these various types of attorneys.
Remember the insurance company will never offer in settlement more (or anywhere near) what they think a jury in court will give you. Certainly, if they are convinced your lawyer won't try your case, settlement offers most assuredly will be low.
3) TIME IS THE ENEMY:
Insurance companies are the heavy weight champions of procrastination.
The longer the insurance company can delay in settlement, the longer they keep you at bay. What happens when they delay in resolving things with you? The short answer is nothing good for you, everything good for them.
Delay leads to injured people giving up on their claims. Delay leads to people having a second or a third injury of some sort that can make recovery from the insurance company even less likely. During delays by the insurance companies, sometimes people get so financially destitute that they get their house foreclosed on and their cars repossessed.
Delay by the insurance company can lead to desperation. Desperation leads to the taking of low-ball settlements. They know it. That is why they do it.
B) What Can You Do To Avoid Being One of the Minions?
First, learn from the patterns above. Don't go without an attorney representing you, unless you have a lot of time on your hands to study your rights, and learn how to try your own case.
Next, when you hire an attorney, avoid attorneys who never try cases. The insurance companies know who they are, and you need to stay clear of them.
Lastly, control the time the insurance company has to ponder the value of your case. Submit your demand in writing, give them the medical records and the bills, and provide them a 30 day time period to respond. However, be prepared to file the lawsuit on the 31st day, unless the adjuster has a darn good excuse for why more time is needed.
Starting the lawsuit is one of those things that puts time and control back on your side. After a lawsuit is filed, there are still many opportunities to settle your case. But, under these circumstances you are more in control. You dictate the pace, and you have shown yourself to not be one of the minions. This approach takes the insurance company out of their comfort level and often causes them to re-examine their prior offers of settlements. Good for you, bad for them.
Don't let the insurance company re-victimize you with a low-ball offer. Stand up for your rights. At Anderson, Hemmat & McQuinn we have a proven track record of trying cases, insurance companies know that and so should you. Make no mistake, in this battle with the insurance company if you have no ammo they will call your bluff every time.
We don't believe in believe in bluffing, we believe in preparation.