How to Respond to a Low Settlement Offer

Injuries require expensive treatment. Even minor injuries sometimes result in financial hardship with as little as a single missed paycheck and a large bill from an emergency room. More severe injuries can be life-altering for the victim’s future, including their ability to earn a living and manage their daily routines.

When an individual or business’s careless or reckless actions cause an injury they are responsible for providing compensation for the victim’s damages—typically through an insurance policy, like auto insurance after a car accident or property liability insurance after a slip-and-fall accident. Note that if you have been in a car accident, contact our car accident attorney in Seattle.

But what should an injury victim do if the insurance company offers a low settlement that isn’t likely to cover all of their damages?

Why Do Insurance Companies Offer Low Settlements?

Insurance companies exist to make profits. Unfortunately, their profits rely on taking in more money through insurance premiums than they pay out in claims. Insurance companies assign adjusters to cases to investigate claims with the primary purpose of minimizing the amount of a payout on a claim as much as possible to protect company profits.

A common insurance company tactic is to quickly offer an injury victim a low settlement very soon after an accident—often before the injury victim knows the full extent of the damages they’re facing such as future medical costs for treating the injury. Essentially, insurers take advantage of the injury victim at a vulnerable time when they may feel like any amount of compensation is beneficial while they are out of work and struggling through medical treatment for their injuries.

Should I Accept a Low Settlement Offer From the Insurance Company?

An injury victim should always be wary of a low settlement offer, especially if it happens soon after an accident and they don’t have an attorney communicating with the insurance company on their behalf. Often, a fast settlement offer occurs because the insurance adjuster acknowledges their policyholder’s liability for the damages and they hope to quickly resolve the matter with a low payout.

Instead of accepting the offer, you should always hire an experienced Seattle personal injury lawyer to handle your claim. An attorney gathers evidence such as the following:

• Photos or videos of the accident or injury
• Police report
• Accident report
• Medical report
• Eyewitness statements

Once your attorney has ample evidence of liability they can begin negotiating with the insurance company for a settlement while simultaneously preparing for a lawsuit in court. A skilled attorney strategizes the best way forward for obtaining the maximum amount of compensation available in your case.

How Should I Respond to a Low Settlement Offer?

A seriously underestimated settlement offer may seem like an insult when you see the mounting expenses of damages from the injury such as medical bills, related expenses, and lost wages—all in addition to the trauma of pain and suffering and an uncertain future. However, it’s best to stay calm and speak with your attorney about an appropriate counteroffer. Your attorney will likely recommend rejecting a low settlement.

If the insurance company makes a second offer that’s also unacceptably low, your attorney may request mediation. During mediation, you and your personal injury lawyer will meet with the defendant and their insurance company attorneys to negotiate. Many times this helps resolve the matter with an ample settlement offer. Otherwise, your attorney may advise following through with a lawsuit to recover damages through a jury award. Litigation in court may take longer than a settlement but often ends with a substantially higher amount of compensation than you’d receive in a settlement. Only about five percent of injury cases require a lawsuit in court.