Negotiation Process of Insurance Settlements
Whenever any property damage lawyers meet with victims, most of them want to know about insurance settlement. There is no second thought that people are interested to know about the insurance settlement process after any damage occurred to their properties. People want to rebuild their damaged things and gain the maximum amount from their insurance claim. If you’re going to know about the settlement process and some most frequent questions about the settlement process, this read is perfect for you.
What is an Insurance Settlement?
You accept an amount of money when you lawsuit or settle an insurance claim. After that, you have the right to any other compensation. But the maximum time the faulty parties and their insurance company will never accept their wrongdoing. They try to offer you money and go away with your claims.
The two common types of settlements are:
- Lump-sum: After an agreement between you and your insurance company, you will receive a single statement payment. That payment is called the lump-sum settlement amount.
- Structured: After the agreement, you can get payment installment wise over time. That scheduled time depends on the size and policies of your settlement.
Everyone should keep in mind one thing: no matter how structured your settlement is, you cannot claim more once you finalize your settlement amount.
Things to keep in mind before starting negotiation:
Claim adjusters are the insurance company employee who works to protect the company’s money and minimize expenses. Adjuster always tries to minimize your claim amount by looking for any potential issues or weaknesses. Unfortunately, the adjuster always tries to find mistakes so that he/she can be able to provide low to the victim.
If you are trying to claim insurance, then you have to be aware of some factors. These are given below:
- Recorded statements: Recorded statement is a popular trick of any insurance company. They always try to make this statement so that they can give the lowest amount to the victims. Cause the questions are already set for the statement and clients to have to make mistakes by providing this statement. Never provide any recorded statement to an adjuster. Otherwise, you will face problems when you want to settle your insurance.
- Independent medical examinations: This is another trick to reduce the claim amount from the clients. Because doctors are already paid to give some faulty reports to the victims so that the insurance company can pay low. IME reports are often used against the clients and reduce the settlement value.
- Discouraging you from calling a lawyer: An insurance adjuster always tries to be sweet and friendly to you. He always behaves such as he is a well-wisher and always works for you. Don’t fall into the trap. Adjuster is always aware that if you hire a lawyer, then they can’t reduce the settlement value. So, they always try to discourage you not to hire any lawyer. For ex: they will try to make you understand that lawyers are expensive.
- Unreturned phone calls: The longer insurance claims go on, the more likely the victims are giving up and accepting a low settlement offer. That’s why some adjusters use delay tactics. The adjuster may avoid returning phone calls and ignore your questions. When the adjuster does this, they’re hoping that you’ll decide your legal claim isn’t worth the trouble.
- Victim blaming: Texas uses a legal standard called “comparative fault” in injury claims. If you contributed to your car wreck, the insurance company could reduce your compensation by your degree of fault. If you were 51% or more to blame, you’ll get nothing. Sometimes, adjusters try to blame victims for reducing or eliminating their compensation. Don’t assume the adjuster got it right — our lawyers have noticed a pattern of unfounded victim blaming in recent claims.
Now come to the steps of the insurance settlement negotiation process:
Step One: File a Claim
The very first job is to file a claim after being injured. Contact the insurance company and file a claim as soon as possible. After filing the claims, the company will contact you within 24 hours, and your negotiation process will start.
Step Two: Reservation of Rights Letter
After filing a claim, you should get a paper called a “reservation of rights” letter. Actually, the letter is given to you to make sure that the insurance company will not accept liability simply. To negotiate with the company you should hire some professionals if you are not an expert on it.
Step Three: Send a Demand Letter
After that, you will send a demand letter by claiming the worth of the insurance. Generally, accident victims wait until they fully recover. If accident victims don’t wait, they might not get the full amount that they claim. To get the total amount of your claim, you should wait and list your damages correctly. Demand letter includes:
- Accident’s time, location, and date.
- How the accident happened
- Information about your injuries and damages.
- A list and summary of economic losses.
- A request for compensation, ex: settlement amount.
Step Four: Read the Insurance Claims Adjuster’s Letter
You should expect the adjuster will offer low. don’t get surprised because of the low offering. You have to do your research properly and make sure about every detail of your policy. So that you can negotiate confidently with the adjuster and the company. Remember one thing, the adjuster tries to make a counter offer but not to focus the low amount of settlement. Stick to your points.
Step Five: Reject the Adjuster’s Offer and Make Your Own
You have that opportunity to write another letter and reject the adjuster’s one. Ex: you can ask for more details about policies. You should not make the offer letter through any adjuster cause he always tries to settle with a low amount. Make the offer letter by yourself or take help from a personal lawyer or expert.
Step Six: Stick to Your Points and Continue Your Negotiations
Don’t skip your negotiations. Try to find every detail about your policy and not provide any details which could be your weakness. If you keep continuing your negotiation, the adjuster will offer a draft of settlement, which you have to attentively before signing it. If you do not understand the drafts, then clear all terms then sign the paper.
You also can file a lawsuit if the negotiation breakdown.
By maintaining the steps properly, you can be a good negotiator and get the full amount of your claim. Always remember you have to stick on your points and be clear about all policies. Only then can you win and get your amount from the company.