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Is a settlement the best outcome during a large car insurance claim?

On Behalf of | Jan 20, 2023 | Car Accidents

Bills from a car crash may continue rolling in for many months after the actual collision occurs. Especially if you suffer significant injuries in the crash, you may have ongoing medical care costs and continuing lost wages that will increase the total financial impact of the collision.

Some people accrue quite a collection of bills and invoices after a major motor vehicle collision. The whole point of liability insurance coverage on vehicles is to provide compensation for the expenses associated with the wreck.

Those with serious injuries may find themselves continually accruing expenses for months or even years after the initial collision. Most people don’t want to deal with an insurance company for that long. Is an insurance settlement the best solution for a significant claim following a wreck?

Settlements are beneficial, but only when they are fair

Many people do feel relieved after negotiating an insurance settlement following a crash. They know that they have the resources to cover their expenses, and there won’t be any complicated negotiations yet to occur. However, receiving a lump-sum settlement does have its drawbacks, not the least of which is the fact that you cannot make future claims against the insurance policy.

You need to know that the settlement amount provided is either at or very close to the policy limit or high enough to fully cover your expenses. If the other driver has a mediocre insurance policy, then your total costs may be higher than what their insurance provider will pay. The most you can ever expect to receive will be the limits for the policy given the circumstances of the wreck.

Still, settlement offers are often below the policy limits, as adjusters offer them as a means of reducing how much the company pays on the claim. Before signing a settlement agreement or accepting a check from the insurance company, claimants injured in car crashes need to know what their total costs will be.

What happens when insurance isn’t enough?

Maybe the settlement offer you received and accepted turned out to be far too low given the injuries you suffered. You might believe that the insurance company acted in bad faith and that you have grounds to bring another claim against the company in civil court.

On the other hand, perhaps the company paid as much as it could, but the policy limits were too low. In that scenario, someone hurt in a car crash may need to consider filing a lawsuit against the driver at fault for the crash. Lawsuits can provide additional compensation when negligence or misconduct contributed to a collision and therefore to your total expenses.

Understanding how insurance settlements can be both beneficial and problematic can help those filing a claim after a car crash.