Can You Negotiate Your Own Auto Accident Settlement? 3 Tips To Get You Started

Posted on: 10 March 2015

After a car accident, recouping the money that you have to spend on repairing your car or paying for doctors and medical treatments becomes a high priority. This is the reason why so many people hire attorneys to help them collect a settlement after an accident. However, not all accidents are the same. While the money that you lose due to a minor fender bender might be a significant amount for you, it may not amount to enough for you to also want to pay attorney fees. In some cases – usually if the accident was minor and determination of fault is straightforward – it may be worth trying to negotiate your own settlement with the insurance company. If you decide to go it alone, here are some tips for getting a fair settlement on your own.

Calculate Your Settlement Amount

Insurance settlements aren't just numbers pulled out of the air. If you want to negotiate with the insurance company yourself, you need to have a clear idea of what amount you might be entitled to. There are several formulas for calculating an insurance settlement after a car accident. For a minor accident, an online calculator can help you determine what kind of amount you should be asking for.

The calculator takes into account any medical expenses from your injury, the cost of repairing the damage to your car, any lost wages due to the accident, and any ongoing medical expenses or wages that will be lost because of the accident. So, if you needed stitches as a result of the accident, you would figure in the cost of the original emergency room visit as well as the future cost of having the stitches removed, and any time at work that you might lose because of those medical treatments. This calculation becomes much more complicated if you will need ongoing therapy or if there's a chance that you might not recover completely, but when the injuries involved are minor, this is a fairly simple calculation.

Send a Demand Letter

Once you've calculated a fair amount, it's time to send a demand letter to the insurance company. The purpose of this letter is to open the negotiations. Your demand letter should describe the accident, explain what injuries you sustained and what medical treatment was required or will be required to treat them, and describe the damage to your vehicle and how much it will cost to fix. Include documentation for all your claims, including copies of police reports, medical bills, and repair shop estimates.

In your letter, you should specify how much money you're asking for. Remember, this is a negotiation, so don't ask for the lowest amount you're willing to settle for. Increase the settlement amount that you've calculated so that you have room to haggle and can still receive a comfortable settlement. Your insurance company will most likely respond with a lower offer.

Don't Accept the First Offer

When you receive the insurance company's response, you may be surprised by how low it is. This is a common tactic by insurance adjusters – they want to see if you know how much your claim is really worth. Unless the offer meets or exceeds your ideal target, don't accept it, and don't propose a settlement amount lower than your initial request yet, either.

Instead, ask the insurance company to explain their reasons for the low offer. Explain that you can't accept such a low offer, and give reasons why – if losing time at work due to medical treatment had a significant impact on your family finances, or if being without a car caused you to miss a conference and impacted your work, now is the time to mention it. Make it clear that your claim is worth more than they're offering, and show the reasons why. If the next offer is higher, you can accept it or propose a counteroffer at that point.

The most important thing you need to know when trying to negotiate your own settlement is when to ask for help if you're in over your head. If the insurance company won't budge and you know that your claim is worth more, if your medical issues resulting from the accident are more serious than they first seemed, or if you're just overwhelmed by the negotiations process, then it's time to look into hiring an attorney. 

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