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3 Reasons Not to Take the First Settlement Offer in a Personal Injury Case


We’ve all heard horror stories about how personal injury cases drag out, sometimes for months and even years. So when an insurance company puts an offer on the table, they should know what your case is worth and you should just take it, right?

Maybe, but there are some reasons why jumping at the first settlement offer is almost never a good move.

You Don’t Know the Extent of Your Damages Yet

If it hasn’t been long since your injury, it is likely that you are not even close to being done with your accident-related medical care. Each injury is different, but many times medical providers will start with non-invasive treatment — medication, massage or physical therapy, pain management — and see if that is effective before they even think about recommending more expensive (and invasive) procedures such as steroid injections or surgery. If you take the first offer, you won’t get any money to cover the cost of medical treatment that may be necessary down the road.

It’s usually best not to even consider settling your case until your primary physician has determined that you have reached “maximum medical improvement,” or MMI. That’s not to say that you’re completely cured; reaching MMI only means that your condition is unlikely to improve any further, and any lingering pain or limitations will probably remain with you. At this time, your doctor will also recommend any future medical care that may be necessary to maintain your condition, and these costs also need to be included in your settlement. So if you settle too soon, you’ll have to pay for those expenses out of your own pocket.

You Need to Get an Acceptable Figure in Your Mind Before You Consider Any Offers

When your attorney put together your settlement demand letter and submitted it to the liability carrier, he likely put in a figure or range that you are demanding in exchange for settlement. Within that range, and before you consider any offers from insurance companies, you should decide on a minimum settlement figure that you will accept, based upon your economic and non-economic damages, wage loss, and the effect your injury may have had on your future earning capacity.

This figure, although you do not have to cling to it at all costs, is for your own information and something you should keep in mind when the pressures of negotiating (and wanting to just get your case over with and avoid a trial) start to mount. If an insurance adjuster points out some facts that weaken your case, you may want to lower this figure, and, if he comes in with an offer close to your minimum, you may want to consider raising it.

The First Offer Is Usually Very Low

Regardless of your damages or what your case is actually worth, an insurance adjuster’s first offer is usually extremely low and merely a tactic to see if you and your attorney know what your claim is actually worth. Or, it may be reasonable but still too low, which might show that the adjuster is trying to be reasonable and would like to settle the case. This will allow your attorney to make a counteroffer and be able to bargain until both sides are able to arrive at a fair settlement figure.

But increasingly, insurance companies are not willing to pay up, and you may have to dig your heels in and prepare to go to trial, based upon your damages and how strong your case is. Personal injury attorneys are usually skilled negotiators, will be able to give you valuable guidance in this process, and help make sure that you don’t settle too soon, as tempting as that may be.

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My daughter and I first consulted with Dan Rosen after a very serious auto accident. Dan had several phone conferences with me, and Tracie was available whenever I called. We would recommend personal injury attorney Dan Rosen to anyone!
Sally from Denver, Colorado

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