Catania and Catania | May 30, 2022 | Personal Injury
Article Updated: September 22, 2024
After an accident, insurance settlement offers often fall short, failing to cover all medical expenses, lost wages, and other damages incurred due to the accident. But even though a lowball settlement offer can be extremely frustrating for accident victims, there are legal options for moving forward and pursuing a better outcome. We’re looking closer at what happens when you reject an insurance settlement offer, why insurance companies even propose low amounts, and how you can respond effectively to secure a fair settlement.
Reasons to Reject an Insurance Settlement Offer
Before we talk about what happens when you reject an insurance settlement offer, let’s discuss the many reasons why you might consider rejecting an offer in the first place:
- Employment Impact: The offer may not fully account for your lost earning capacity, especially if you cannot return to your previous job or work.
- Insufficient Compensation: The offer does not cover all current and future medical expenses, lost wages, and other costs related to the accident.
- Underestimation of Injuries: The severity of your injuries may not be fully acknowledged, leading to an offer that doesn’t account for long-term care or potential complications.
- Exclusion of Non-economic Damages: Pain and suffering, emotional distress, and loss of enjoyment of life are not adequately compensated.
- Quick Settlements: Offers made soon after the accident may attempt to capitalize on your immediate need for financial support, potentially undervaluing your claim.
- Fault and Liability Issues: If there’s disagreement or ambiguity about who is at fault, accepting a settlement might unfairly assign you more liability.
- Incomplete Investigations: The insurance company might not have completed a thorough investigation, or you may have new evidence that affects the claim.
- Pressure Tactics: The insurer might pressure you to accept a quick settlement, often indicating that the offer is not in your best interest.
- Legal Representation: You haven’t consulted with a personal injury attorney who might significantly increase the settlement amount through expert negotiation.
- Future Expenses: If your future medical expenses, rehabilitation costs, or potential surgeries are uncertain, it may be premature to accept an offer.
Thinking Twice Before Accepting a Low Settlement Offer
Initially rejecting car insurance settlement offer proposals from the insurer is not only your right but sometimes necessary to secure adequate compensation. Before making any decisions, it’s crucial to consult with a personal injury lawyer who can assess the fairness of the offer based on the specifics of your case and guide you through the negotiation or litigation process if necessary.
Why Do Insurance Companies Offer Low Settlements?
The simplest reason for lowball offers is that insurance companies aim to minimize payouts to maximize profits. Like any business, they are a “for profit” organization – unfortunately, this means that they will not hesitate to submit a settlement offer that is unfair to victims. Beyond their goal to reap maximum profits, there are a few key factors that can negatively impact your settlement offer, including:
Determination of Fault
In both “at-fault” and “no-fault” states, insurance companies may reduce their offers based on their assessment of your fault in the incident. Even a slight implication of your liability can significantly decrease your potential settlement. This assessment often involves a detailed review of accident reports, witness statements, and any available video evidence.
Understanding how fault is determined can be critical, as it directly influences the compensation you might receive. Hiring an experienced attorney can help you effectively contest any unfounded assertions of fault and ensure your settlement is not unjustly reduced.
Underestimating Your Losses
Often, insurers use algorithms and databases to calculate settlements, which might not accurately reflect the true cost of your injuries and losses. Providing detailed documentation and expert opinions can help correct these underestimations.
Insurers may not consider the long-term implications of injuries, such as ongoing medical care, modifications needed for your home or vehicle, and reduced quality of life. So, it is incredibly important to present a comprehensive claim that includes future projected costs to ensure all potential expenses are covered.
Bad-Faith Practices
Some insurers deliberately offer low settlements irrespective of the claim’s merits. Recognizing and challenging such bad-faith practices is essential and typically requires legal expertise. Instances of bad faith might include unreasonable delays in processing claims, failing to conduct a proper investigation, or refusing to pay a claim without a reasonable basis.
A lawyer skilled in dealing with bad-faith insurance tactics can help you counter these strategies and possibly seek punitive damages for egregious conduct by the insurer.
What Happens If You Reject an Insurance Settlement Offer?
Rejecting an insurance settlement offer is a significant decision that shifts your claim into a new phase of negotiation or litigation. When you decline an offer, it opens the door for further discussions where you can present a stronger case for a more appropriate compensation.
There are a few routes you can take if you’re thinking about rejecting an offer from the insurance company.
Reject the First Offer and Continue Negotiating
The insurance company’s offer is just that: an offer. The insurance company’s first offer is often low, and they fully expect you to reject the first offer. In fact, it is relatively common for an injured person to reject the insurance company’s first offer.
Unfortunately, rejecting the insurance company’s offer is not as simple as demanding that they give you a better offer. You must generally write a letter to the insurance company formally rejecting their settlement offer. It is wise to explain why you are rejecting the offer and make a counteroffer, using your injuries and damages as the basis for your counteroffer.
Rejecting the insurance company’s first settlement offer will likely lead to negotiations. While negotiating may be a lot of work, it can pay off in the end. You can continue negotiating until a deal is reached or the insurance company refuses to continue negotiating.
Request a New Insurance Adjuster
If the insurance company refuses to continue negotiating a settlement offer after you reject their first offer, it may be because the claims adjuster is trying to discourage you from additional negotiations. Insurance companies sometimes use this tactic to get injured people to take less money than what is owed to them.
An insurance adjuster may even refuse to settle for an offer they previously made to you. If this happens, the adjuster may be engaging in bad faith negotiation tactics. However, you can use your own strategies to combat these bad-faith negotiations.
Keep track of the following when communicating with insurance company representatives:
- Who you are communicating with
- The dates you communicate with them
- The offers they have made
- The counteroffers you have made
- Anything else you believe is important to notate
If you catch the insurance adjuster using bad faith tactics, report them immediately. Then, request a new adjuster for your claim. With a new insurance adjuster onboard and a recent incident of documented bad faith negotiations by the insurance company, settlement negotiations may resume.
Take the Case to Court if Settlement Negotiations Fail
Finally, and as a last resort, you can take your claim to court. However, it is important to consult with a Tampa personal injury attorney before you go to court to determine whether your case is suitable for trial.
It is important to remember that if you take your claim to court and lose, you will receive nothing. On the other hand, if you win at trial, the judge or jury may award you more than you could have settled for with the insurance company.
Because these two extremes are possible outcomes of a trial, you should speak with a lawyer to ensure that you reach the best result.
How Long Do You Have to Accept a Settlement Offer?
The time you have to accept a settlement offer typically depends on the specifics laid out in the offer itself, as most insurance companies set a deadline within which you must respond. Be sure to review the terms carefully to ensure you don’t miss this window.
Generally, you have the time span specified in the offer to make a decision. Still, this period can often be negotiated if you need more time to evaluate the proposal or consult with an attorney. Additionally, make sure to check your state’s statute of limitations because failing to settle or file a lawsuit within this timeframe can forfeit your right to pursue compensation later.
Insurance Companies are Not Always on Your Side
Despite their friendly advertising, insurance companies are fundamentally profit-driven. They employ various tactics to reduce payouts, including delaying claims processing or complicating the settlement process. Being aware of these strategies can help you navigate the negotiations more effectively.
Unlike an insurance company, your attorney is professionally invested in helping you achieve the best possible outcome in your case. Not only do excellent accident attorneys strive to be successful on a professional level, but they are also often very personally passionate about the pursuit of justice and accident victim advocacy.
Contact a Personal Injury Lawyer for Help With Your Settlement Negotiations
Have you or a loved one been injured in an accident? You don’t have to navigate the legal aftermath alone. If you have questions like “What happens if I don’t accept the insurance offer?” or “Why is my insurance settlement so low?” the accident attorneys at Catania & Catania can help.
Whether you are in the early stages of settlement negotiations or you’ve reached a roadblock with the insurance adjuster, you should consult a personal injury lawyer to discuss your claim.
For a free case review, contact our experienced legal team today.
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