Following an accident in which you were not at fault, you’ll need to file a claim with the at-fault party’s insurance company, and the insurer might send you a settlement offer to avoid the litigation process. But before you sign, it’s important to understand the consequences of doing so. Should you accept the first offer in a settlement?
Car Accident Claims in Missouri
Missouri is a fault state for car accident claims. This means that you file your claim with the at-fault driver’s insurance company, and they are responsible for paying the damages you suffer up to the policy’s limit.
Insurance companies often make early settlement offers when their insured’s liability is clear. For example, if your accident occurred because the other driver ran a red light and T-boned your vehicle, their insurance company might offer you an early settlement. Should you accept the first offer in a settlement?
Settlements benefit both you and the insurance company. You can avoid going to trial in exchange for receiving a guaranteed sum, while the insurance company can settle your claim for less than its full value without risking a loss at trial. While most injury lawsuits are resolved through settlements, you shouldn’t accept the first offer you receive.
Why You Shouldn’t Accept the First Offer
Should you accept the first offer in a settlement? In most cases, the answer to this question is no. Insurance companies commonly offer lowball settlements to injured parties. They often do this soon after an accident occurs for two reasons. First, the insurer hopes that you’ll accept the initial offer so they can settle the claim for far less than what it’s worth. Second, insurance companies extend lowball offers to convince injury victims that their claims are not worth as much as they are.
The first offer is the bottom-dollar amount the insurance company will pay to settle your claim. They hope that you will take it instead of retaining a lawyer. Instead, you should ask an experienced attorney to evaluate the offer and the evidence from your accident and medical treatment. They can properly value your claim and negotiate a fair settlement for you. In fact, your attorney will use that initial offer as a basis to negotiate for more money. In addition, once you retain a lawyer, the insurance company will no longer be able to talk to you directly and must instead communicate with your attorney.
Suffice it to say, you should never sign an initial settlement offer without having an experienced lawyer review it. If you accept this offer, you won’t be able to come back later and ask for more money when you find out it doesn’t cover your losses.
How Does an Attorney Value a Claim?
Your lawyer will use multiple pieces of information to properly value your claim, including all the following:
- Total amount of your medical bills
- Future anticipated medical expenses and rehabilitation costs
- Transportation expenses to get to and from your doctors’ appointments
- Income losses caused by your injuries
- Future reduction in your ability to earn an income
- Property damage
- Other out-of-pocket expenses
These damages are called economic or special damages. They are classed as compensatory damages. A second compensatory damages category is your general or non-economic damages, which includes intangible losses, such as the following:
- Physical pain and suffering
- Psychological trauma
- Scarring/disfigurement
- Disability
- Reduction in your ability to enjoy life
Attorneys typically begin by calculating your economic damages. Once they have that total, they usually multiply it by a factor that ranges from one to five based on the severity of your injuries to estimate your non-economic losses.
Another factor that can impact the value of your claim is the at-fault party’s insurance. If they only have the minimum liability coverage required by the state, it might not be enough to cover your losses. Similarly, if the at-fault driver is uninsured, recovering compensation will be more difficult. In that case, you will recover compensation up to their policy limit. You can then use your underinsured/uninsured motorist coverage for the amounts that exceed the driver’s policy limit.
Talk to Our Experienced Lawyers
If you have received an initial settlement offer after a car accident that wasn’t your fault, the best option is to speak to an attorney at the Law Offices of Bryan Musgrave before you talk to the at-fault driver’s insurance company. We offer free consultations and can help you understand the value of your claim and your options. Schedule your consultation today by calling us at 417-322-2222 or sending us a message online.