When someone offers you money, it’s hard to say, “No.”
That’s the predicament people find themselves in when an insurance company makes a settlement offer.
On the one hand, you know insurance claims are complex legal matters, and insurance companies aren’t necessarily trustworthy.
On the other hand, a little extra money sounds nice right now, and the insurance company is telling you, “Take it now or you’ll risk getting nothing at all.”
That’s why one of the #1 questions we hear when we answer our phones is this: “Should I accept my insurance company’s settlement offer?”
Unfortunately, there isn’t a one-size-fits-all answer. Below, we offer a few points that you should consider carefully before accepting an insurance company’s settlement offer.
Settlement Offers Come with a Catch
When the insurance company hands you money, it will demand something in return: a signed release agreement.
That agreement requires you to agree that, in exchange for the settlement money, you will never again make a claim against the insurance company arising out of this same accident or circumstance.
In other words, you’re signing away your right to additional compensation and other legal rights — even if you would otherwise be entitled to more.
These release agreements are written in fairly ironclad language. They are binding, and they are permanent. Generally speaking, courts will enforce them.
It’s quite a catch, which begs the question: is it worth it?
Understand the Insurance Company’s Goals
When you’re asking yourself, “Should I accept my insurance company settlement offer?” try to look at it from the insurance company’s perspective.
Insurance companies are for-profit corporations. They aren’t in the business of giving away money. They don’t offer you money because they feel bad for you. They don’t make settlement offers because they care about you. They don’t write checks because “it’s the right thing to do.”
No, the amount of money they are offering you is the result of a careful, complex mathematical calculation. The formula they use is designed to work in their favor.
The insurance company’s goal is to make your claim go away (1) as quickly as possible, (2) for as little money as possible, and (3) permanently.
Generally speaking, the amount of money they offer you is what they believe to be the “sweet spot” between what will seem tempting to you on the one hand and the smallest amount of money they can get away with paying you on the other.
The initial settlement offer will typically represent less than the victim is entitled to. Insurance companies know this. It is intentional. They are trying to get the best deal they can, while still leaving room for bargaining if it comes to that.
Make no mistake about it: the insurance company has plenty of money, and they might even have more set aside just for your claim. But don’t expect them to offer it up without a fight.
What if Your Damages Cost More than Expected After You Accept the Settlement?
We’ve seen it too many times: an accident victim rushes into a settlement agreement, believing their injuries were no big deal. They figure they’re lucky to get some quick cash out of the accident.
Then the medical bills come in — sometimes six months or a year later — and they’re for a lot more than the victim expected.
Or, alternatively, what seemed like a minor injury turns out to be much more serious. This can happen in a few ways:
- There were serious injuries but symptoms were delayed (this is very common).
- Infections, inflammation, or other complications set in.
- The immune system over-responds to the injury, or otherwise fails to respond adequately.
- Recovery takes longer than doctors expected.
- One injury leads to another, and there is a clear “causal chain” between them.
- There is a problem with the original treatment or surgery, which ends up requiring additional treatments or surgeries.
If you’ve already accepted your insurance company’s settlement offer, you will have already signed away your right to demand compensation for complications you didn’t foresee.
For this reason, you should always give it time. At the very least, let your injuries fully heal before you let the insurance company buy your rights away from you.
Make Sure You Understand Your Rights & Options
There is potentially so much at stake in an insurance claim. On top of that, there is a powerful and experienced corporation working against you. Mistakes are easy to make. It’s so important that your decisions be made on the basis of solid information and advice.
Certainly, there are situations where the damages are pretty minimal and the claim is pretty straightforward. In those cases, it may make sense to accept the settlement offer.
But it’s always a good idea to talk with a lawyer first. Make sure you understand your rights and options. Talk to the Kingston personal injury lawyers at O’Connor and Partners.
Schedule a Free Case Review with Our Kingston Personal Injury Lawyers
Still wondering, “Should I accept my insurance company settlement offer?” Get in touch with our Kingston personal injury lawyers and let’s talk about it.
At O’Connor & Partners, we fight hard to maximize compensation for the clients we represent. We look out for the little guy in the face of powerful and aggressive insurance companies. We will not charge you any attorney fees unless and until we win for you. Contact our offices today for a free case review.