The era of personal injury lawsuits is fading fast. Only 4% of personal injury lawsuits ever go to trial. The vast majority of the rest are settled out of court and in most cases, before even going to court at all. And there’s good reason why too.
Litigation can be time-consuming, stressful and may end up with you spending a large chunk of what you eventually get as compensation. And there’s the distinct possibility that this amount may be less than what you expected. So, unless you have a very good lawyer or a very strong case, litigation is best used as a last resort.
That being said, a willingness to litigate is often a key component in obtaining a full settlement. Insurance companies take you more seriously when you have a lawyer who is prepared to go to trial. In many cases, settlement offers improve dramatically even after mediation. A good lawyer knows that preparing your case for trial doesn’t mean it will go to verdict, but it does mean you are positioning yourself to seek the best result.
In your bicycle accident case, you make the ultimate decision on whether you want to go to trial or settle. Choosing settlement can mean that you get your compensation much quicker and with a bit less stress compared to litigation. But the settlement process can be pretty tough too.
Insurers, their loss adjusters and other at-fault parties are not, strictly speaking, the most generous when they have to settle a case. They play hardball because they’d rather not give you all you want if they can escape it. So, they’re likely to try and under-settle the case if they even agree to settle at all.
If you’re going to tease out every penny that your case is worth from them, you also need to have an accurate picture of exactly what you’re worth. This is where the problem often lies especially if you decide to try and settle the case without a lawyer.
When you have a good bicycle accident lawyer working with you on your case, there’s no problem because they have done this countless times and either already have a good idea of what your case should be worth or can find out pretty quick. However, it can be a tad more difficult for you.
How does a settlement work?
Settlement is an alternative to litigating a case to verdict, or it can be used to avoid filing a lawsuit in the first place. When a case is settled, it simply means that you and the person who caused your bicycle accident, or their representatives, agree to close the case as soon as they pay you a negotiated amount of money as compensation.
Settlement usually occurs after a written request with supporting materials is sent to the insurance company pre-suit, or after suit is filed, often in the context of a mediation which is a formal settlement conference supervised by a neutral third party.
If you’re going to pursue a settlement, though, you need to understand that once you accept the settlement sum, it’s final. The settlement is treated as a binding agreement on the both of you, and it has the effect of barring you from going back to the court or the insurance company to ask for more money.
This is why settlement should never be rushed into. You need to calmly consider all of your options first or come to an accurate understanding of what your case is worth before you accept a settlement offer or even start negotiations at all.
Another important thing you need to understand in determining your settlement sum is how negotiations with insurers usually go.
How insurers negotiate: Unrepresented claimants get shortchanged
There’s generally two default modes for insurers in settlement negotiations. They’re determined by who’s doing the negotiating, you or your lawyer.
The first mode is for when you tell the insurers that you’ll be the one negotiating your own settlement. They generally react to this like a dog would when he sees a nice, juicy steak.
This is because they’d see the absence of a lawyer as an attempt to save money. This means you may be desperate and more likely to jump at any amount they throw your way. And they’ll be just plain glad because they don’t expect you to know what a lawyer does about the process.
So, they’ll often start out the negotiations with an extremely low figure that’ll probably have you startled. It’s because they feel they have the upper hand against you and there’s not much you can do about it.
The second is for when they see you in company of an experienced personal injury lawyer. Here, they’re much more careful. They’re more likely to do an objective assessment of the case first, its strengths, weaknesses, how prepared they are for litigation, your injuries, expenses and other likely heads of compensation.
Even with a lawyer, the insurance company will try to settle the case for less than it is worth. Filing suit and getting the case set for trial will often produce a settlement offer which is double or triple the pre-suit settlement offer if the fault is clear, the insurance coverage is available, and the injuries are serious.
Determining the right settlement amount
In order to arrive at a sum that you should be fairly entitled to as settlement, you would need to take several factors into consideration. You need to consider the cost implications that the accident has introduced into your life, the major lifestyle impact of the accident and the level of fault of the person who caused the accident and of course the coverage available through the defendant’s policy or your own uninsured motorist coverage. Any pre-existing injuries also factor into the value equation.
The sum total of all of this should be your minimum settlement amount. Here’s a rough breakdown of these factors.
The expenses you have incurred
Accidents are expensive, more often than not. You’d have to bear the initial cost of medical treatment, physical therapy, replacing lost property, possibly repairing your damaged bicycle or any temporary alternative arrangements you would be forced to make.
When the time comes to consider how much you should be entitled to as settlement, these expenses should come first in your consideration. You need to be adequately reimbursed for your outlay in this regard.
If there’s a chance you may need future treatment, you have to consider the cost of that treatment in your settlement figure. Ideally, you should wait until you’re either fully healed from your accident injuries or as healed as you’re going to be, before you round off these expenses. In the most serious cases a life care planner should be retained to itemize the future medical expenses.
You are also entitled to claim as damages the wages you have lost as a result of your injury. Future loss of earning capacity can also significantly enhance the value of your claim. In some cases an economist or vocational expert may be necessary to prove these damages as there are technical evidence rules which require clear documentation.
The impact on your life
This is also considered non-economic loss. It basically covers all the ways in which the accident has profoundly affected your life and reduced its quality from what you had before. You are ordinarily entitled to seek compensation for this loss in a lawsuit, and you can include it in your determination of an appropriate settlement amount.
The kind of loss considered here includes permanent deformity even if it does not affect your ability to work, pain and suffering, profound lifestyle changes like having to remodel your house and depression.
While there’s no real way to quantify what you may be losing here, it is still possible to assign a dollar amount to it. There are methods that are used to calculate appropriate award of compensation here, but the important thing is that the amount must be fair and just to you. So you can work your way up from there.
The fault of the other party
The other party’s level of fault can also be a big factor in determining your settlement amount. If their fault level is very high, then the insurer has less room for negotiation and your settlement figure can be higher.
Major indicators of a high fault level include situations where the accident was caused intentionally, recklessly, due to intoxication or in consequence of a deliberate attempt to break the traffic rules.
The strength of your case
If you have been able to put together a strong account of the facts, complete with pictures of the accident scene, witness statements and a police report that all backup your story, it gives you a huge hand up in negotiations.
Once you’re done considering all this, the figure you’re left with is how much you should be entitled to as compensation. Remember to be flexible, though. Be ready to go higher if you discover factors that make your case even stronger than you thought. Be ready to go lower if the facts show your case is weaker than you imagined.
Regardless of which it is, be careful not to be unreasonable with your initial figure. If the sum is outrageous, you could end up closing the negotiation channel quicker than you opened it.
There’s no exact science to determining the best amount you should settle for. However, the factors discussed here can give you a pretty good idea of your ballpark figure. Once you’re done determining the amount, get the following:
- Your medical records and bills
- A copy of the police report
- Your wage loss information
- Witness statements
- Photographs of the accident scene
Then draft a settlement demand letter outlining all the facts as you have them and attach these documents to the letter. This puts you on a strong footing and ensures you don’t get the short end of the stick. These are the steps that a lawyer would take, and although you can duplicate his or her format, be aware that the insurance company will try to take advantage of the unrepresented accident victim.
In reality, if your injuries are multiple in nature or require surgery or months of physical therapy, particularly if there has been a positive MRI or other objective finding of injury, then it becomes very difficult for a layperson to evaluate the value of the case. Lawyers have the advantage of years of experience, proprietary databases that delineate verdicts and settlements for particular injuries, and negotiating experience to obtain the best settlement possible. The different insurance policies available, the strength of the witnesses and all other matters go into an evaluation of the value.
A final issue is the willingness of the injured party to be aggressive in pursuing the best result, or alternatively to be more inclined to settle and be done with it. There is no requirement to have an attorney, but more serious injuries should be evaluated and handled by a professional. An experienced lawyer can enhance the value of your case by hiring the right experts to contest the insurance carrier’s picked and paid hired guns who invariably take a strong position against the innocent victim.
The best way to ensure you get what you deserve is to let a lawyer help you get it. If you’d like to know more about how a lawyer can help you, just click here to set the ball rolling.