How do insurance companies calculate car accident settlements?
The goal of all insurance adjusters is to settle your claim for the lowest amount possible. You should never accept the first offer made by the insurance company. An experienced attorney whose goal is to get you fair compensation for your injuries will be able to negotiate on your behalf to get a more equitable settlement amount based on your specific case.
Settlements are meant to make you whole. In other words, to put you back in the same position that you were in before the event that caused your injuries. The settlement should include compensation for both special damages and general damages. Special damages refer to your financial losses and include medical bills, lost income, and property damage. General damages are less tangible and include things like loss of quality of life, emotional trauma, and loss of enjoyment of life. General damages are oftentimes referred to as compensation for pain & suffering. There is no standard calculation for general damages, rather they are are meant to compensate you for the harm caused and the impact the harm has on your life.
Know what is factored into a personal injury claim settlement
Many adjusters use a software system called Colossus that allows them to input all the points of data and provides them with a range in which to negotiate. Most of the software programs also factor in if there is an attorney involved and the track record of that attorney to garner larger settlements on behalf of clients. The system is designed to offer less of a settlement to victims without an attorney, making it vital to have proper representation at the negotiation table.
Since consumers cannot access Colossus or other adjuster tools, it is important to know what points of data are input to provide you with a settlement number.
Special Damages – Property
This includes damage to your vehicle, motorcycle, or even structures, like a garage or house. What are the cost of repairs? Or is the car considered a total loss because the repairs and parts are more than the vehicle is worth? Insurance companies will pay you for the value of the car in its state prior to the accident. This is rarely enough to get a replacement vehicle because of depreciation.
Special Damages – Medical Bills
You only get one shot at this claim. Be especially careful when negotiating compensation for your and medical bills. Insurance adjuster oftentimes refuse to pay all your medical bills, claiming the charges were too high and the treatment was unnecessary or too long. If there is a need for future treatment that should be estimated and submitted in the claim because you cannot go back and file another claim for more money if injuries continue or resurface.
General Damages – Pain and Suffering
Pain and suffering claims are in addition to medical bills and lost wages. These are considered general damages and include loss of quality of life, which covers general limitations of what you can do and experience; and loss of enjoyment of life, which specifically addresses a talent or pastime you can no longer pursue. Adjusters will argue that the value of your pain and suffering is limited especially where your recovery has been good.
Insurance Policy Limits
No matter the injuries or pain and suffering, insurers will not offer a settlement in excess of the at-fault driver’s policy limits. So even if you have a legitimate claim of $50,000 and the policy caps at $30,000, you will only receive the $30,000 as a settlement. A good attorney can advise you of your rights when your damages exceed insurance coverage, including whether you can make a claim under your own policy.
Getting the maximum settlement from your claim is a delicate balance of what you are facing now and what you may face in the future as a result of the accident. Experienced car accident attorney, Matt Dion, can help you navigate the insurance companies and get you the compensation to put your life back together. Call for a free consultation today.