Car crashes can turn your life upside down. Recovering from injuries, increasing medical bills, and missed time from work can quickly create overwhelming stress. Amidst that stress, you get the call: the insurance company wants to settle and makes you an offer.
Should you accept the insurance company’s first settlement offer? In most cases, not until you understand the full value of your claim. An early offer may not account for future medical treatment, lost income, pain and suffering, or other insurance coverage that may be available. And once you accept a settlement and sign a release, you generally cannot go back and ask for more compensation later.
Key Takeaways
- You do not have to accept the insurance company’s first settlement offer.
- An early offer may come before the full extent of your injuries and damages is known.
- Before accepting, consider future medical care, lost income, non-economic damages, and all potentially available insurance coverage.
- Once you sign a settlement and release, your claim is generally over, even if your injuries later turn out to be worse than expected.
- If you have significant injuries or are unsure whether an offer is fair, a Missouri personal injury attorney can review the offer before you make a decision.
Why Do Insurance Companies Make Early Settlement Offers?
In general, insurance companies make early offers because resolving a claim sooner can benefit the insurer. Some reasons why insurers push for early settlements include:
- Cost Control: Early settlement can reduce the administrative workload for adjusters and avoids defense costs should the claim result in litigation.
- Limiting Future Claim Costs: If your injuries require more treatment than initially expected, the value of your claim may increase. Settling early can prevent those additional costs from becoming part of the claim.
- Reducing Litigation Risk: If a claim turns into a lawsuit, there is always uncertainty about how a judge or jury may evaluate the evidence and damages.
- Closing the Claim Efficiently: Insurance companies handle large numbers of claims. Resolving a claim allows the insurer to close its file rather than continue investigating, evaluating, and negotiating it.
None of this automatically means the insurance company is acting improperly or that every first offer is unfair. But the insurer is evaluating the claim from its own perspective, which is why you should evaluate the offer from yours before accepting it.
What Might the First Settlement Offer Leave Out?
One of the biggest risks of accepting an early settlement is that you may not yet know the full impact of the accident.
An offer may not fully account for:
- Medical expenses you have already incurred
- Future medical treatment, including rehab, follow-up procedures, medication, or ongoing care
- Lost wages from time you have already missed from work
- Reduced earning capacity if your injuries affect your ability to work in the future
- Permanent impairment or disability
- Pain, suffering, and loss of enjoyment of life
- Out-of-pocket costs, such as transportation, medications, co-pays, or household help
- Medical liens or reimbursement obligations
- Additional insurance coverage that may apply to the accident
This is why the amount of an insurance settlement should not be evaluated based only on the medical bills sitting on your kitchen table today. The real question is what the accident has cost you, and may cost you in the future, in total.
How Do You Know What Your Car Accident Claim Is Worth?
There is no single formula that determines the value of a personal injury claim. Every case is different. When evaluating a settlement offer, some of the most important factors include:
- Past medical expenses: Bills, statements, payment records, and other documentation showing the cost of treatment related to your injuries.
- Expected future medical treatment: Your doctors may be able to provide information about future treatment, rehabilitation, procedures, or ongoing care.
- Permanent impairment or disability: Long-term limitations can significantly affect the value of a claim.
- Lost wages or reduced earning capacity: Pay records, employer documentation, tax records, and other evidence can help establish income you have lost because of the accident.
- Non-economic damages: Pain, suffering, emotional distress, inconvenience, and loss of enjoyment of life may also be part of a personal injury claim.
- Out-of-pocket expenses: Transportation costs, co-pays, medications, and other accident-related expenses may be considered.
- Liability: If there is a dispute over who caused the accident, that can affect settlement negotiations.
- Available insurance coverage: The amount and type of coverage available can have a significant effect on how a claim is resolved.
What Insurance Coverage May Be Available After a Missouri Car Accident?
Another reason not to rush into a settlement is that the main insurance policy may not be the only coverage that applies. These are the insurance policies you need to know about:
Your Own Insurance Policy
Start by reviewing your policy’s declarations page. Depending on your coverage and the circumstances of the crash, your own policy may provide benefits in addition to what is available from the at-fault driver.
The At-Fault Driver’s Insurance
If another driver caused the crash, you may pursue a third-party claim against that driver’s insurance coverage. For example, some accidents involve an employer-owned vehicle, a commercial vehicle, or a ride-share driver.
A Missouri personal injury lawyer can investigate which insurance policies may apply rather than evaluating the settlement based only on the first source of coverage identified.
Can You Reject an Insurance Company’s Offer?
Yes. You are not required to accept the insurance company’s first settlement offer. You can reject the offer, ask for additional information, or make a counteroffer.
If you decide to counter, your position should be supported by evidence showing why you believe the claim is worth more.
That documentation may include:
- medical records and bills;
- information about future treatment;
- wage-loss records;
- documentation of permanent injuries or limitations;
- receipts for accident-related expenses; and
- information explaining how the injuries have affected your daily life.
You can also give the adjuster a reasonable deadline to respond to your counteroffer so negotiations continue moving forward.
Keep in mind, however, that settlement negotiations do not automatically extend the deadline for filing a lawsuit.
Many Missouri personal injury actions are subject to a five-year statute of limitations under RSMo § 516.120, but determining when that period begins can be more complicated than simply counting five years from the date of an accident. Missouri law generally looks to when the resulting damage was sustained and capable of ascertainment, and different deadlines apply to certain types of claims.
For that reason, you should not assume you have five years in every personal injury case.
How Long Does an Insurance Claim Take to Settle?
Every case is unique. A relatively minor injury claim may be evaluated quickly, while a case involving significant injuries, future medical treatment, disputed liability, or multiple insurance policies may take considerably longer.
The insurance company also needs enough information to evaluate the claim. If you are still receiving medical treatment, for example, it may be difficult to know the full extent of your injuries or what treatment you may need in the future.
You can learn more about how long a personal injury claim takes to settle in Missouri.
What Happens If You Accept the Settlement Offer?
Once you accept a settlement, you will typically be asked to sign a Settlement and Release of All Claims or similar document. Once signed, the settlement is generally final, meaning you usually cannot seek additional compensation later if your injuries worsen, you need additional treatment, or you experience long-term complications.
When Should You Talk to a Personal Injury Lawyer About a Settlement Offer?
Not every insurance claim requires an attorney. But it is especially important to consider legal advice when:
- you suffered a serious or permanent injury;
- you are still receiving medical treatment;
- you may need future medical care;
- you have missed substantial time from work;
- the insurance company disputes who was at fault;
- multiple people or insurance policies may be involved;
- you are unsure what insurance coverage is available;
- medical liens may affect the settlement;
- the insurer is pressuring you to settle quickly; or
- you have been asked to sign a release that you do not fully understand.
In those situations, having the offer reviewed before you accept it can help you understand what the claim may be worth and what rights you will be giving up.
The personal injury attorneys at Harper, Evans, Hilbrenner & Netemeyer can review the circumstances of your accident, available insurance coverage, documented damages, and settlement offer so you can make a more informed decision.
Insurance Settlement FAQs
Is the First Settlement Offer Always Too Low?
No. There is no rule that says an insurance company’s first offer is always too low. However, an early offer may be made before the full extent of your injuries, future medical needs, lost income, or other damages is known. The important question is whether the offer fairly accounts for the facts of your particular case.
Can I Negotiate a Settlement Offer Without a Lawyer?
Yes. You can negotiate directly with an insurance company and make your own counteroffer. If you have significant injuries, disputed liability, future medical needs, or questions about available coverage, however, an attorney can help you evaluate the claim before you settle it.
Can I Get More Money After I Sign a Settlement Release?
Generally, no. A settlement release is normally intended to resolve the covered claim permanently. If your injuries later worsen or you discover additional expenses, you generally cannot reopen the settled claim simply because you need more compensation.
Harper, Evans, Hilbrenner & Netemeyer represents people injured in accidents throughout Missouri. If you have received a settlement offer and are unsure whether it fairly reflects your claim, our attorneys can review the offer and explain your options.
Call (573) 520-3127 or contact us today for a completely confidential case evaluation.
Disclaimer: This content is for general informational purposes only and does not constitute legal advice or create an attorney-client relationship with Harper, Evans, Hilbrenner & Netemeyer. Individual results vary.