What Is a Contingency Fee?

When an injury victim is dealing with painful medical treatment, long recovery times, and mounting medical bills, the idea of taking on the legal system for a complicated personal injury claim can be overwhelming. Even worse, many injured victims decide against hiring an attorney to navigate the complex legal system because they worry that they cannot afford attorney fees on top of their medical costs and related expenses.

What many injury victims don’t realize, is that a reputable personal injury attorney should cost them nothing upfront. When someone suffers a preventable injury entirely due to another party’s negligence, reckless actions, or intentional harm, the victim should not be left with the undue burden of injury-related expenses and lost income.

Experienced personal injury attorneys in Seattle understand that the victim of a negligence-related injury shouldn’t be held accountable. Instead, the vast majority of personal injury lawyers offer free case consultations and contingency-based fees.

If you’ve been injured by another party’s actions or negligent inaction, you may wonder, “What is a contingency fee and what does it mean for my case?”

How Does a Contingency Fee Work in a Personal Injury Claim?

Attorneys understand that injury victims don’t plan ahead for sudden traumatic injuries caused by someone else’s actions. Some examples of personal injury claims include the following:

• A car accident caused by a distracted driver
• A slip-and-fall accident in a convenience store with a leaky freezer that a store owner was aware of but put off repairing
• An injury caused by fireworks with a defective fuse

When these accidents occur, the injury victim and their families may face financial hardship as a result. Personal injury attorneys offer free initial consultations to determine if the injured victim has a clear case for liability on the part of the person or business entity that caused the injury. If the attorney feels that the victim has a strong case, they’ll offer to represent that victim throughout the claim process and in court if necessary, all at no cost to the victim unless or until the attorney succeeds in securing compensation for the victim.

In a contingency-based payment structure, the attorney takes their fee at the end of the process, by keeping a percentage of the victim’s compensation for damages. “Damages” in a personal injury case refer to the economic consequences of the injury, such as medical costs and lost wages, as well as non-economic damages like the victim’s pain and suffering. A skilled personal injury attorney carefully calculates the victim’s damages to maximize the amount of compensation they can claim before taking a percentage of the victim’s ultimate settlement amount or court award for damages. Typical percentages in contingency fee payments for attorneys are 30 to 33%.

Advantages of Contingency Fee Payments in Personal Injury Claims 

A contingency-based payment structure offers several important advantages to the majority of personal injury victims. These include the following:

• No upfront payment is required for experienced legal representation on challenging personal injury claims which typically require an investigation to determine and prove liability, documenting evidence, negotiating with insurance companies for a settlement, and sometimes taking the matter before a judge and jury if the insurance company refuses to offer an acceptable settlement amount
• The attorney has a strong incentive to secure the victim’s compensation since they don’t get paid for their time if they aren’t successful
• The attorney will carefully calculate the victim’s damages to ensure they get the maximum amount of compensation available so the attorney earns enough to cover their costs and time with their percentage and the victim still retains ample compensation for their economic damages

Contingency fees work well for both the injury victim and their client in the majority of personal injury claims. The main disadvantage of this payment structure is that some attorneys may decline to take on an injury victim’s case if they feel the evidence isn’t strong enough to risk investing unpaid hours on the claim.

In some instances, if an injury claim results in a fast settlement, the client may feel that the agreed-upon percentage taken for the attorney’s fees may exceed the amount of time the attorney put into the case.

If you or a loved one suffered an injury due to another party’s negligence or wrongdoing, it’s important to fully understand your attorney’s contingency fee amount and payment structure before hiring them for your case.