After a car accident, you might wonder whether you should take the first settlement offer you receive than waiting around for more compensation that might never come.
The short answer is no. While you could accept the initial settlement offer following your crash, doing so is generally a bad idea.
A settlement may be the best way to resolve your outstanding claim and receive sufficient compensation for your injuries. However, it’s rare for the first offer to reflect your claim’s actual value and compensate you fairly, even in cases of a loved one’s death.
The prospect of receiving, negotiating, and responding to settlement offers is intimidating to many injury victims. Understandably, you might want to accept the first offer presented so as not to prolong the time it takes to get paid.
That said, working with a car accident lawyer can help ensure your settlement negotiations are concluded swiftly and in a way that benefits you.
Why the First Settlement Offer Should Usually Be Rejected?
Following a car accident where the other driver is clearly at fault, you can expect to receive a settlement offer from the driver’s insurance company or attorney. In some cases, it may come directly from the other driver. You may get the offer by telephone, email, or traditional snail mail.
When you receive this offer, you might initially be excited because you believe the other driver has accepted responsibility for the wreck and is not challenging your right to receive damages.
However, the other party, their insurer, and their legal counsel all have one goal in making this offer to you: to minimize the money they’re forced to pay out for your claim.
Thus, the first settlement offer you receive likely won’t cover your losses and meet your needs. Rather, it’s an attempt to reduce the potential losses the at-fault driver expects to sustain if your claim progresses.
What Happens When You Accept a Settlement Offer?
When you accept a settlement offer in a car accident case, you forfeit any further rights to compensation you may have against the other party.If the settlement offer doesn’t cover your bills and losses, you’ll be responsible for making up the difference some other way. This lack of full compensation could mean either turning to your insurance policy or paying for the difference out of your own pocket.
What to Do When You Receive the Initial Settlement Offer?
Instead of accepting the first settlement offer you receive, take the settlement offer to your car accident lawyer and ask them for their expert legal opinion.
Your car accident lawyer will evaluate the sufficiency of the offer to address:
- The medical expenses you incurred and those you may incur in the future
- Ongoing physical therapy or mental health counseling you might require
- The property damage your car sustained in the wreck
- The time you missed from work and the corresponding loss of wages
- Your inability to participate fully in personal or family activities you once enjoyed
- Having to experience mental pain and suffering
You and your car accident lawyer should also discuss the unique strengths and weaknesses of your claim. Lastly, you’ll want to weigh the benefits of settling and therefore avoiding a trial versus the difficulties you may experience if you don’t receive adequate compensation promptly.
Armed with this information, you and your car accident lawyer can arrive at a suitable amount for which you should settle your claim.
Meeting with your counsel under these circumstances enables you and your legal counsel to engage in fruitful and informed negotiations with the other party. It also makes you more likely to reach a settlement that serves your best interests and holds the responsible party accountable for their negligence.
Why the Other Party Wants to Settle More Than You Do?
One common tactic insurance companies use to entice accident victims to settle quickly and for the lowest possible offer is convincing them that the first offer is the only one they’ll receive.
By adopting a take it or leave it demeanor, insurance companies hope they’ll frighten you into simply settling your case out of fear that you’ll get nothing if you don’t.
However, the other driver and their insurance company have a concerted interest in settling your case for the lowest amount they can get away with, even if it’s more than they initially offered. That’s because going to trial is expensive, even for the prevailing party.
For insurance companies, some attorneys’ fees may not be recoverable. The human resources cost of having one or more legal professionals working on a case for months or years simply isn’t worth it.
Furthermore, a trial presents risk and uncertainty for both parties.
While the at-fault party may prevail, or you may obtain a judgment from the court that’s less than the amount initially offered, it’s equally possible that the opposite could occur—you might win, and the court might award you significantly more compensation than the amount you sought through your settlement offers.
Considering the relative bargaining position of you and the other party regarding settlement negotiations, you and your car accident lawyer are typically in a similar position as the other party. You each have an interest in settling the case for a fair amount that you both can live with.
Experienced Legal Counsel Can Identify the Right Settlement Offer for You
Don’t assume that just because the other driver or their insurance company is quick to make you a settlement offer, it means you must accept it. These lowball offers aren’t in your best interests, and they could leave you footing the bill for some of the losses for which you would otherwise have been compensated.
When you receive a settlement offer, contact a qualified Virginia personal injury lawyer to discuss it and any counter offer you might want to make. Settlements can be helpful to both you and the other party, but only if the terms reflect your interests.