How Do Insurance Companies Negotiate Settlements?

How Do Insurance Companies Negotiate Settlements?

If you need to contact the insurance company, you likely will communicate with a claims adjuster. The adjuster is the one who reviews your claim and either accepts or denies it. They may call you immediately after the accident with a compensation proposal.

Generally, they offer far less compensation than you need to cover your bills. The reason is the adjuster follows a process to determine and negotiate the settlement amount. Emroch and Kilduff can assist you in negotiations and much more. Learn how a personal injury lawyer can benefit you below.

Insurance Companies Have Methods to Reduce SettlementsInsurance lawyers

Insurance adjusters handle anywhere from 50 to 100 claims a month. They are familiar with the settlement process and know ways to reduce or avoid a payout. One way an adjuster could close a case is to declare the person’s injury is due to a pre-existing condition.

A pre-existing condition means the liable partly likely was not responsible for bodily harm. As a result, the insurance company can get out of a settlement. However, the argument may not work for injuries like a broken leg. Additionally, you could still have the right to compensation even if you have a pre-existing condition.

A policy might have words or statements an average person finds confusing. Insurers use the way they write their terms to convince claimants to settle for less. For example, the adjuster might tell you the coverage limit is less than it is.

Lawyers understand the type of language an insurance policy uses. They can tell you more about how much money the insurer owes you. Find a reliable firm before agreeing to an offer and signing the papers.

Some adjusters try to talk claimants out of hiring an attorney. They are aware a law firm can conduct in-depth investigations and increase the value of a case. Attorneys know what tactics insurers use and fight aggressively to protect their client’s rights.

The adjuster might tell you a lawyer is costly and how you can save money without one. Another misleading statement is a lawyer slows down the process, and you would have to wait longer for reimbursement. Regardless of what the insurer says, an attorney can help you get the results you need.

How Do Insurance Companies Negotiate Settlements?

Adjusters Start With an Investigation

After you file your injury claim, the insurance company contacts you to negotiate a settlement. To prepare, the adjuster begins with an investigation into the accident. They look for evidence of who is liable and the value of the damage.

During the investigation, the adjuster tries to learn the facts of the incident. They may visit the accident scene and get a copy of the police report. They talk to the other party to obtain their story. Next, they may call the claimant to get a recorded statement of their version of events. However, the injured party does not need to give one.

Additionally, the insurance company requests medical records and bills, proof of income, and evidence of property damage. They receive training to go through each document thoroughly. They look for any missing details or implications of a pre-existing condition.

Adjusters Calculate a Settlement Offer

When the adjuster calculates the settlement, two types of damages influence the value. Economic damages are the exact numbers of your accident-related finances. The company adds your expenses for medical treatment and property repair.

Next, the claims adjuster estimates the value of the non-economic damages. Many insurers use a formula to calculate the value of losses like emotional distress.

Adjusters consider people’s chances of winning if they file a lawsuit as well. Clear liability usually means you have a higher probability of success. As a result, roughly 95 percent of cases resolve before a trial. Additionally, the coverage policy impacts the company’s offer.

Once the insurance company determines a settlement figure, they suggest a percentage of the value. The initial offer usually is an unnecessarily low dollar amount. During negotiations, the adjuster may pressure you to accept. Therefore, you should have a lawyer present to let you know if the proposal is a fraction of what they owe you.

Looking For a Personal Injury Lawyer?

If you have been personally injured recently one of the best decisions you could make right now is to hire a personal injury lawyer. A lawyer will be able to go over your case details and provide the crucial steps you need to have a chance of winning your claim. Emroch and Kilduff is here to support you, reach out to us!


Can Insurers Monitor Social Media?

Over 290 million people document their lives on Twitter alone, so insurance companies seize the opportunity to monitor claimants. The online posts a person makes about the accident could affect their case. During the investigation, an adjuster wants to use what the individual says to lower the payout.

Legally, the other party’s insurer can view your social media accounts. The material you post is public, so investigators monitor for any incriminating evidence. The content they look for includes status updates on your well-being. If the other party damaged your vehicle, an adjuster tries to find pictures of the car before the incident.

The court can allow any material the insurance company discovers. Of course, a few legal boundaries may exist. You can work with your lawyer to ensure your online presence does not affect your case.

Tips for Negotiating With Insurance Companies

Walter H Emroch
Personal Injury Attorney, RetiredWalter H Emroch

Even though the adjuster has experience with claims, they do not have much training in legal or medical fields. You are the most familiar with your claim, and you understand the extent of your injuries. You can use your knowledge to achieve a fair settlement deal.

Tips to prepare for negotiations are:

  • Determine a settlement amount. Before you begin negotiations, you should know the value of your claim. Additionally, pick a baseline to help you stay focused when the adjuster applies pressure.
  • Reject the initial offer. The adjuster may offer a low settlement to see if you know your claim’s worth and to test your negotiating skills. Do not lower the figure in your demand letter. Instead, reject the deal and request the adjuster to justify the low dollar amount.
  • Highlight the emotional points. The facts of the case are necessary to win compensation. Nevertheless, the insurer is likely to agree to a fair deal if you mention the emotional parts of the claim. You can show images of the damage and reiterate the pain and suffering you experienced.

You do not need to enter negotiations by yourself. An Emroch and Kilduff lawyer can help you prepare for what the insurance company may throw at you. Contact us to get a consultation and see how we can support you.

William B. Kilduff


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