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How Do Insurance Adjusters Determine Personal Injury Settlement Offers?

Written by Ankin Law Office

Personal injury cases often result in settlement offers made by insurance companies. Insurance claims adjusters investigate injury claims to determine how the accident occurred, the fault for the accident, and the extent of any injuries and/or damages.

Personal Injury Settlements

Personal injury claims cover a wide range of injuries caused by car accidents, slip and falls, trauma, and acts of violence. When injuries are due to the negligent actions of another person, victims are entitled to compensation for their injuries through a personal injury claim. Victims may file their lawsuit in court or negotiate a settlement award through the at-fault party’s insurance provider.

The majority of personal injury claims never make it to court. Many claims are often settled through an insurance company and a victim’s Chicago personal injury attorney. To determine the amount of a settlement award, the insurance claims adjuster must thoroughly investigate the accident claim through various procedures.

Contacting the Policyholder

Claims from insurance companies are considered to be third-party claims. This occurs when the at-fault driver has coverage through an insurance provider. The first thing any claim adjuster will do is contact the policyholder to discuss the accident and get the policyholder’s side of the story. This includes details of the accident report made by police officers, as well as details of property damages and personal injuries.

Contacting the Claimant

After talking to the policyholder, the claim adjuster will contact the claimant (the injury victim who filed the claim). The adjuster will discuss the same information with the claimant to see if stories and details of the accident line up. Insurance adjusters often investigate claimants by using a database that checks if the claimant has ever filed a previous personal injury claim. Google searches may also be used to look for any information on the claimant that may discredit the claim.

Requesting Documentation

Personal injury cases involving negligence require proof. The next step is to gather documents showing proof of injuries. At this point, the claim adjuster will contact the claimant’s Chicago personal injury attorney to request documents that show proof of property damages and medical treatments for injuries. The adjuster may need copies of the claimant’s tax returns and proof of earnings. All information is reviewed to determine the accuracy and red flag alerts that may signal a dishonest claim.

Determining the Value of the Claim

Once the claim adjuster investigates and reviews the case, he or she will assign a value to the claimant’s injury claim. Until all factors are thoroughly reviewed, the insurance adjuster will not respond to any settlement demands, make a settlement offer to the claimant or his/her Chicago personal injury attorney. When determining the value of the claim, the adjuster looks at two important factors:

  1. What are the claimant’s chances of winning if the case proceeds to a court trial?
  2. How much would a jury award the plaintiff in damages?

Damages fall under two separate categories: (1) damages that are calculated through documentation such as medical bills and lost wages, and (2) incalculable damages such as pain and suffering.

Calculated Damages

Insurance claims adjusters look closely at calculated damages from health care providers, not just hospitals and licensed physicians. If the claimant has a $5,000 bill for physical therapy or rehabilitation services, the adjuster may cut that in half down to $2,500 because the bill came from a third-party health care provider.

Pain and Suffering

Placing a value on a claimant’s pain and suffering is more complex because it does not relate to tangible, physical injuries. Pain and suffering usually describe pain, emotional distress, mental problems, and loss of enjoyment of life caused by injuries. Specialized software with formulas that place a value on pain and suffering may be used by the insurance claim adjuster.

Making a Settlement Offer

When the claims adjuster arrives at a figure, a settlement offer will be made to the claimant. If the claimant accepts the offer, the payment may be paid out in a lump sum or individual payments according to a settlement agreement. In many cases, insurance companies start with low offers, up to 40% of what the case is worth, especially when a Chicago personal injury attorney is not negotiating on the claimant’s behalf.

In Illinois cases, a personal injury lawsuit must be filed in court within two years of the injury date or the claim may be dismissed by a court judge. If the claim proceeds to trial, and the claimant wins the case, compensation may be significantly higher than an insurance settlement award. However, the time frame for a court trial in civil court may take considerably longer, possibly 12 to 18 months depending on the complexity of the case.

Categories: Personal Injury