It's the insurance adjuster's job to save the company money. Therefore, it's not unusual for the person to low-ball you when offering a monetary settlement for your car accident case with the hope that you don't completely understand the strength or value of your claim and will simply accept the offer as is. While this may make you feel frustrated or even a little insulted, this offer is just the start of the negotiations. Here are some tips for countering a low-ball settlement offer that may help you get what you're truly owed.
Learn the Reason for the Offer
The first thing you need to do is learn the insurance adjuster's reasoning for the low-ball offer. Sometimes the adjuster will say in the offer letter why he or she valued your damages so low. Other times, you will need to call the person and ask how he or she arrived at the number.
Knowing the reason for the offer will help you better formulate a response. Sometimes adjusters have legitimate reasons for offering so little compensation. They may dispute your liability claims or may not have received enough information about your injuries to properly evaluate how serious they are. If this is the case, providing the missing details or reiterating the reasons why the insurance company's client is liable for the accident will typically lead to a more reasonable settlement offer.
As noted previously, though, sometimes adjusters submit low offers because they hope claimants will simply accept them. It happens all the time, and especially with people who aren't represented by attorneys that can advise them differently. If there doesn't appear to be any legitimate reason for the low offer, then your response should focus more on providing a reasonable counteroffer.
Writing the Counteroffer
When writing the counteroffer, start by acknowledging the adjuster's reasons for the low offer if there were any, and counter these reasons with the facts of the case. For instance, if the adjuster disputes his or her client was liable for the accident, quote the portion of the police report citing the person for a traffic violation that contributed to the collision and include a copy of the official paperwork.
Afterwards—or if there weren't any valid criticisms of your claim—reiterate your losses and damages and follow up with an amount you're willing to settle for. The amount you submit must be reasonable in light of your actual damages and the other party's policy limits; otherwise the adjuster may feel like you are not attempting to resolve the issue in good faith, something that can hurt you if you end up going to court.
A good way to determine what is reasonable is to first add up your actual losses (e.g. medical bills, lost wages). Second, calculate your intangible damages such as pain and suffering using the same damage formula adjusters use when calculating how much to pay claimants. Typically, the amount is derived by multiplying your medical damages by a number between 1.5 and 5 to get the additional amount you should be paid.
The exact multiplier to use will depend on the severity of your injuries. If you will suffer a permanent disability because of the accident, then you may want to use the highest multiplier to ensure you get enough money to cover your long-term needs. On the other hand, if your pain was mild and you recovered quickly, then you may only want to use the lowest multiplier.
Add those two numbers together to get an amount to counter with. If you know what the other person's policy limits are, try to keep your counter offer within them. You can be certain the adjuster will never offer you more than what his or her client's policy covers, so it's best to save yourself the frustration and work with what's available.
At the end of the letter, make note that you're fully willing to take the issue to court. Lawsuits are expensive to defend, which is why most personal injury cases are settled out of court. Adjusters often earn bonuses based on the amount of money they save the company, so the person is more likely to make a better offer the second time around to avoid being sued.
For more tips on countering a low-ball offer or assistance with negotiating with an insurance company, contact an attorney from a firm like Welsh & Welsh PC LLO.