Insurance companies often make quick settlement offers after someone files a claim for compensation. You may be tempted to accept a quick settlement offer because you have medical bills and have lost wages because you missed work.
It is important to remember you have time to consider the offer. It is often best to reject the first settlement offer because it does not account for all your damages.
You should strongly consider working with a Green Bay personal injury lawyer to see what your best course of action may be. Our attorneys can negotiate with the insurance company. If their offer is not good enough, we can make counter-offers and continue negotiations. If they refuse to make a fair offer, our attorneys can file a lawsuit to pursue your claim.
Below, we discuss why you should take your time considering a settlement offer.
Why is it Often Best to Reject the First Settlement Offer?
The insurance company may contact you soon after you file a claim. This usually happens when you have extensive damages. The insurance company hopes you accept what you believe may be a generous offer. If you do, they can avoid paying the full value of the claim, saving themselves money.
Sometimes the insurance company waits for you to send a demand letter before making an offer. After you state your expectations for compensation, they will make a counteroffer. However, as this is their first offer, it will likely be far below the full value of the claim. Regardless of when they make their first offer, it is often in your best interest to reject it, as a lot more compensation may be available.
The first settlement offer rarely covers the full cost of your claim. Even if the offer appears generous to you, it is most likely not. You will not know the full extent of your damages until you progress in your recovery. You must also consider lost wages and the cost of repairs to your vehicle if you were involved in a car crash. The insurance company’s first offer is unlikely to account for these damages.
Why Injury Victims Should Make a Counteroffer
Our attorneys can help determine the full extent of your damages. Once you have a better understanding of what you are owed, we can help draft a demand letter to the insurance company. In this letter, you are demanding compensation for the full cost of your damages. It may also include evidence to support the number you are demanding.
Your counteroffer kicks off negotiations with the insurance company. Once they receive our demand letter, they have some time to consider the counteroffer. At this point, they may agree to pay out what we are asking or make another offer.
Factors to Consider Before Accepting a Settlement Offer
You should talk to an attorney before you accept a settlement offer from the insurance company. You should do this even if the insurance company makes it sound like they have your best interests in mind.
A lawyer can thoroughly investigate your claim to determine:
- Who the liable party is, including if there are multiple parties you can pursue compensation from
- What the costs of your injuries are, including future costs and any expenses for medical equipment and home modifications for a disability
- How much your lost wages are worth, including lost earning capacity if you are forced to take a different job or stop working altogether
- How much your non-economic damages are worth, including pain and suffering and other emotional damages like lost enjoyment of life
The first settlement offer rarely considers any future or non-economic damages. Before you accept an offer, you should consider how much these damages might be worth. Again, your attorney can help determine the value.
Is There a Time Limit to Accept a Settlement Offer?
There might be, and this would be set by the insurance company making the offer. Your attorney can review the situation to determine if there is a deadline – it is important to decide before the deadline because the insurance company may try to deny your claim if you miss it. That said, this could be considered an unethical tactic, and your attorney may be able to push back on it.
However, you should not allow yourself to feel rushed into a decision. The accident was not your fault, and you may be eligible for significant compensation for your damages.
Always be aware that all claims are subject to a statute of limitations. In some instances, there are also deadlines to file certain notices that can be very short. You should immediately consult with one of our attorneys to make sure you do not miss any deadline dates or your claim could be extinguished.
Call an Attorney Today
Before you accept a settlement offer, you need to take time to consider it. Although there may be some time restraints you should consider, it is also important to look at the offer from every angle.
Our attorneys are ready to help you do that. We can also negotiate with the insurance company on your behalf, as we know how to determine if an offer provides all the compensation you need.
Call us today to schedule a free consultation: (920) 260-4528.