If you’ve never been involved in a car accident, you probably don’t know what it takes to negotiate a settlement with an insurance claims adjuster. Most people think that insurance is a straightforward system. They pay a certain amount in premiums in return for coverage when a car accident causes damage or physical injuries. Unfortunately, many people don’t realize how complex car insurance is until after they have an accident.
What Is an Insurance Claims Adjuster?
A claims adjuster usually works for the insurance company to investigate insurance claims. In some cases, the insurance company hires a freelance company to handle their claims. The adjuster looks at the damages resulting from an accident to property and to people. Their job is to determine the extent of the insurance company’s liability to any claimants. The adjuster represents the interests of the insurance company, not the claimants.
These damages might result from a direct claim or a personal injury case. The claims adjuster might speak with the claimant and any witnesses to the accident. They will also inspect any property damage, review accident reports and medical records, along with any other pertinent records.
The adjuster will use several resources to determine how much it will cost to repair any property damage. They will then submit their report to the insurance company. The report describes the accident, the claim amount, and the insurance company’s liability. Often, the issue of liability is where the negotiation process breaks down.
Filing an Insurance Claim: The First Step in the Negotiation Process
In no-fault insurance states, it doesn’t matter who causes an accident. You file an insurance claim with your own auto insurance company. In at-fault insurance states like California, that isn’t the case. The person who is liable for the accident must pay the parties who experience damages to property and bodily injuries. That makes liability an important issue for the insurance company.
In an at-fault state, the injured party usually files a claim with the at-fault party’s insurance company. This is why you should always get the other party’s contact information and the name of their insurance company at the accident scene. You should file a claim as soon after the accident as possible. Often, insurance companies accept claims over the phone or online. Filing a claim is the first step in the negotiation process with the insurance claim adjuster.
The “Reservation of Rights” Letter: The Second Step in the Negotiation Process
Soon after filing an insurance claim, you should receive a reservation of rights letter. This is a letter stating the insurance company’s intention to investigate your claim. Although they agree to investigate the circumstances of the accident, they aren’t accepting liability on behalf of their client. Some of the losses might not be covered by the insurance policy. They reserve the right to evaluate or disclaim coverage for some or all of the losses listed in the claim.
Legal language is often complex and difficult for the average person to understand. If the details in the reservation of rights letter aren’t clear, contact a personal injury attorney to discuss your case.
Sending a Demand Letter: The Third Step in the Negotiation Process
Once you know the value of your claim, you will send a demand letter to the insurance company. This is a document that lets the insurance company know the amount of compensation you expect. The amount should include damages to your property, bodily injury, and compensation for pain and suffering.
Your demand letter will include details about the accident such as:
- The location, date, and time the accident occurred
- How the accident happened
- A summary of your injuries and your medical treatment
- A summary of your damages and financial losses
- A request for compensation – the amount you are willing to settle for
Don’t overlook the importance of sending a demand letter. The time and effort that goes into writing it might prevent you from the expense of a court case. Unlike a court case, the demand letter doesn’t result in a judgment by a jury or judge. If the insurance company doesn’t agree to your demands, however, you still have other options.
It is important that you wait until you are fully recovered to send a demand letter. You only have one chance to make a demand for compensation. Sending it too early could result in your receiving less than you actually need. You might need future medical treatments or compensation for lost income or other financial losses that you didn’t expect.
If your claim is for a minimal amount, you might consider writing your own demand letter. Most people will benefit from hiring a personal injury attorney to craft the document for them. The demand letter is an important part of the negotiation process. When done professionally, it can help prevent you from going to court and improve your chances of getting a fair settlement.
The Response to Your Demand Letter: The Fourth Step in the Negotiation Process
Once the insurance company receives your demand letter, the claims adjuster will probably respond with a letter of their own. In most cases, it is a rejection letter that disputes the value of your claim. Often, they make a counteroffer that is much lower than the real value of your claim.
The insurance adjuster knows that your injuries are costing you lost wages. They also know that your medical bills are adding to your financial burden. They use your lack of knowledge about the law and your financial desperation to get you to accept a much lower offer. This is just one of the tactics insurance companies use to pay less. Remember, the claims adjuster works for the insurance company. It’s their job to save the insurance company as much money as possible.
Reject the Claims Adjuster’s Offer: The Fifth Step in the Negotiation Process
You can write a second letter to the adjuster explaining why you are rejecting their offer. Add more details about your symptoms and your need for medical treatment. You might come down slightly on your previous offer, but not much. Make your initial offer the starting point for the negotiations – not the counteroffer made by the adjuster.
Continue the Negotiations
In a negotiation, one person moves down incrementally while the other one moves up in the same manner. They reach a settlement when they meet somewhere in the middle at a number both agree on. When that happens, the claims adjuster will draft a settlement agreement. Have your attorney read the agreement carefully before you sign it.
When either party isn’t willing to move in the other direction, negotiations fail. Your next option is to file a personal injury lawsuit in court. Although the point of negotiations is to avoid the expense of a lengthy court trial, it does allow you to seek full compensation for your injuries.
Talk with your attorney about pursuing your claim in court. Even if a claims adjuster refuses to pay a reasonable settlement, it doesn’t mean you don’t deserve the compensation you asked for.
What You Should Know About Dealing with an Insurance Claims Adjuster
Dealing with an insurance claims adjuster isn’t easy. They have a different set of priorities than you do. What seems like a straightforward process often gets complicated along the way. This might be your first time negotiating a settlement. The adjuster does it for a living. They know things that most people don’t. Sometimes they use their knowledge to prevent you from getting the compensation you deserve. For example:
Time Isn’t On Your Side
Every state has a “statute of limitations” that gives you a specified amount of time to file a lawsuit. In California, you have two years from the date of the accident to file a lawsuit. If the adjuster drags out the negotiations process, you might run out of time before you realize it.
It’s a good idea to add a deadline to your demand letter for the adjuster to accept your offer. That lets them know that you are aware of the deadline for filing and that you are prepared to take the next step.
Loss of evidence is another way that time can hurt you. Evidence is paramount to winning your case. The more time that goes by following the accident, the more evidence you lose. Some examples are lost photos, witnesses that move away, and failing memories about details of how the accident occurred.
Write down the details of the accident immediately after it happens. Take photos at the scene and store them in a safe place. Maintain records of witnesses, the accident report, medical records, and any treatments. If any evidence disappears, the claims adjuster can fill in the gaps in any way they want.
What You Say Can Be Used Against You
No, you aren’t under arrest. But the insurance adjuster can use what you say against you. Adjusters often reach out to accident victims right after an accident for the sake of clarifying their claim. If the adjuster contacts you, don’t make any comments or provide any details. It’s their job to know how the accident occurred and what damages you received. All they want is to get you to say something that they can use against you.
The adjuster may sound like they have your best interests at heart. In reality, they want to save the insurance company some money. If they ask if you’re feeling better and sound concerned about your well-being, they aren’t. They are looking for ways to diminish your injury claim and prove that you don’t deserve as much compensation as you requested. The best thing you can do is refer them to your attorney.
The Adjuster Doesn’t Want You to Hire an Attorney
A claims adjuster relies on your vulnerability and lack of legal knowledge to get the best outcome for the insurance company. They are trained in the art of negotiation. An adjuster knows what to say and do to get you to say the wrong thing.
The adjuster knows that if you hire a personal injury attorney to represent you, they no longer have the upper hand. Your attorney knows what you deserve and the laws that back up your claim. He is also a skilled negotiator who has learned the techniques the insurance company has in its arsenal. The bottom line is that hiring a personal injury attorney will almost always result in your getting a much larger settlement than you might achieve on your own.
One of the fastest ways to lose your rights is simply not knowing what they are. Never give the adjuster a recorded statement or sign any documents. The insurance company will ask you to sign a medical authorization to release all of your medical records. An attorney might advise you to forward your own records and bills to the adjuster instead. This prevents them from obtaining additional records that they don’t need and which they might use against you. For example, if you are seeking compensation for a back injury, any previous back conditions give the other side an argument that your injury was “pre-existing.”
When you start negotiations with an insurance claims adjuster, you hope it ends with a settlement. Even so, you should start preparing evidence for a personal injury claim immediately after the accident. If you are unable to come to an agreement, you have everything your attorney needs to get a positive outcome in court.
Start with a Free Consultation
If an insurance claims adjuster won’t budge from a low settlement amount or denied your claim altogether, don’t give up or give in. Talk with a personal injury attorney about your case and a fair settlement amount. Whether he reaches an agreement through negotiations or in court, you will get a better outcome than trying to negotiate on your own.
Contact Batta Fulkerson for a free consultation to discuss your car accident claim. You deserve compensation to pay for your damages and injuries. Don’t let the claims adjuster convince you that your losses are less significant than they really are.