Most car accident claims are resolved through private settlement, not courtroom litigation. You don’t conclude a settlement on a handshake, however. You need a written settlement agreement. For you to get paid, both parties must sign the settlement agreement before the statute of limitations deadline passes.
Following is an explanation of some important facts about car accident settlement agreements that might come in handy.
1. Insurance Adjusters Can Probably Negotiate Better Than You Can
Insurance companies exist for one purpose and one purpose only—to make as large a profit as they can. They make money by collecting monthly premiums from their policyholders. They don’t make money by paying out claims. When you submit a car accident claim to an insurance company, the insurer becomes your adversary.
It is in their interest to deny your claim, or at least to minimize it. It is in your interest, of course, to maximize the value of your claim.
Insurance adjusters are professional negotiators. When you negotiate with an insurance adjuster, they represent the insurance company, not you.
2. Settlement Agreements are Final
The opposing party will not sign a settlement agreement unless it contains clauses that render their payment to you final. This means you cannot go back to the negotiating table and ask for more money if you later find out that your case was worth more. You can’t go to court either.
Your claim will be dead even if the statute of limitations deadline has not yet passed.
Don’t ever sign a settlement agreement until you are certain that you know how much your claim is worth. Your lawyer can help you understand the value of your damages.
3. Settlement Agreements are Very Broad
Certain clauses are standard in car accident settlement agreements. For example, once you sign a typical settlement agreement, you cannot claim damages for injuries that you didn’t know you had at the time you signed the settlement agreement. In other words, if you discover a new injury after you sign the dotted line, you are out of luck.
The settlement agreement might also prevent you from suing unknown defendants. Suppose, for example, you accept an inadequate settlement in a DUI injury case because the driver had few assets and minimum insurance policy limits.
Suppose you later discover that you could have sued the nightclub owner that served alcohol to the driver on the night of the accident. The typical settlement agreement will prevent you from doing this.
4. A Settlement Agreement is a Legally Binding Contract
A car accident settlement agreement is just one of many types of contracts. If the opposing party refuses to pay on time, you can take them to court on an ordinary contract claim. This is not a personal injury lawsuit because you have already settled that issue. It is simply a demand that the opposing party honor their contractual obligations.
If you win your contract claim, the court has the power to seize the opposing party’s assets to pay you the settlement amount.
- You Shouldn’t Sign a Settlement Agreement Provided by the Insurance Company
You should be very suspicious of a settlement agreement drafted by an insurance company; it will disadvantage you in important ways. Maybe it is too late, and you have already signed a settlement agreement drafted by the opposing party. Even so, you still have one aspect of the law that favors you. According to a long-standing legal principle, a court will interpret any ambiguity in a contract against the interests of the party that drafted the contract.
Your best bet is to have your lawyer draft the settlement agreement. Don’t worry; your lawyer cannot reach a final settlement on your claim without your specific permission. Most lawyers charge their legal fees based on a percentage of their client’s compensation (contingency fees). Therefore, your lawyer has every motivation to seek as large a settlement as possible.
5. Ways to Protect Your Injury Claim
Following are some of the ways that you can protect yourself from the typical mistakes people make when preparing for and negotiating a settlement agreement:
- Seek medical attention as soon as you can after the accident. The insurance company will have a harder time claiming you have a “pre-existing injury.”
- Stay off social media. Social media posts can be used against you.
- Don’t settle your claim until your doctor tells you that you have reached MMI (Maximum Medical Improvement). If you don’t wait for MMI, you will have trouble placing an accurate value on your claim.
- If you have suffered catastrophic injuries, don’t hesitate to hire experts to calculate (i) your lifetime medical expenses and (ii) your lifetime lost earnings. If your lawyer believes in your claim, they might pay this money upfront and deduct it from your compensation later.
- If the opposing party sends you a check for an inadequate settlement amount, don’t cash it. Cashing it could be interpreted as acceptance of the amount of the check as a final settlement.
There are a hundred more mistakes you might make without the assistance of an experienced car accident lawyer.
Contact a Lawyer as Soon as Your Claim Arises
To maximize your chances of receiving full compensation, start working on resolving your claim while it is still young. A personal injury lawyer will know how to investigate your claim and file a claim with the opposing party.
Here at Battle Born Injury Lawyers, we have won over $100 million for our clients over the years. Contact us online or telephone us 24/7 at (702) 570-9000 for a free initial consultation. We serve clients from all over Nevada.