Steps to an Insurance Claim Settlement

What you need to know about how to reach an insurance claim settlement after your accident

Once you are injured in an accident, receiving compensation is more than just a simply filing a claim with the guilty party’s insurance.

Most of the time, there will be negotiating involved with the insurance company along with an extensive investigation of your claims. After all of this, insurance companies may still low-ball your claim, and knowing how to proceed can be very important.

Reaching an insurance settlement can be a steep climb.

You’re entitled to a chance at compensation to help with your medical expenses, emotional trauma, and other damages. Here are the steps to an insurance claim settlement to help you have the best chance at adequate compensation.

Collecting information begins the process

As soon as possible after your accident, it’s important to begin gathering evidence and information about your accident. This means taking pictures of the scene and damage and keeping copies of all paperwork (police reports, medical records, witness statements, etc.).

Here is an accident report you can fill out to preserve details.

Enjuris tip: Proper documentation can make or break a case. Check out our checklist to see all documents you may need for your personal injury case.

When to file your claim

Filing your claim too early or too late can affect the results.

Before you file, it’s important to make sure that your injuries and medical conditions have stabilized. This is called “maximum medical improvement” and filing before your body has reached this level of improvement can mean that some of your potential bills or expenses may be lost in the shuffle. You don’t want to get going on a settlement before you know the complete extent of your injuries.

On the other end of the spectrum, each state has its own statute of limitations in order to prevent you from waiting too long to file your claim. For example, Texas requires that personal injury cases be filed within 2 years from the day the accident occurred. Otherwise, compensation will not be available.

Once you’ve collected evidence and you know the full extent of your damages, it’s time to file your claim.

1. Submit a demand letter

The first step on the way to settlement is to submit a demand letter to the responsible party’s insurance company.

Your demand letter should include how the accident happened, how the defendant is responsible for the accident, the extent of your injuries and damages, and how you have suffered because of these damages. Lastly, your demand letter should conclude with the amount you desire to seek for your claim (the sum of all of your damages).

Enjuris tip: It’s important to use polite language and make the insurance company fully aware of the intent of your case in your demand letter. Check out our article for more demand letter tips.

Each of these points should be backed up with facts and supportive evidence in order to prove your claims. Make sure to include copies of your medical records, the police report, and any other documents you may for your case.

What if I don’t like the insurance company’s response?

After you submit your demand letter, the defendant’s insurance company should respond within a month. If you don’t receive a response, contact them consistently until you do.

The insurance company can respond in a few different ways. They can say that you haven’t adequately proven your case and are owed nothing. If this is the case, you should speak to a personal injury attorney as soon as possible.

Most often, the insurance company will respond with a lower compensation than you demanded in your letter, and this begins the negotiation process.

2. Negotiate your claim

Keep in mind that insurance adjusters do not want to give you your full compensation amount. It’s important to know your facts and stand your ground in order to receive the compensation you deserve for your damages.

The insurance adjuster will do all they can to refute your claims of liability and damages. They may do this by referencing areas of your medical records or the police report. It’s important not to argue angrily, but instead respond with well-informed facts that explain why you deserve this level of compensation.

If they deny your claim without a reasonable basis, then see how to handle insurance bad faith.

It’s important to remember to be patient throughout the negotiation. Insurance adjusters want you to get impatient and settle for less than what is reasonable for your damages; stand your ground.

It’s important to stay patient during the offers and counteroffers of an insurance negotiation.  Tweet this

There’s no set amount of time that the negotiation process can go on, but after a few offers and counteroffers between you and the insurance adjuster, hopefully you both reach a settlement that is fair.

However, if you fail to reach a settlement, you may have to take your claim to the courts.

3. Head to court

If your negotiation with the insurance adjuster goes nowhere, you may pursue your compensation in court.

Depending on the amount of damages you have suffered, you may proceed to small claims court as long as the amount of damages doesn’t exceed your state’s limit. You aren’t required to have legal representation in small claim’s court, but you are welcome to if you desire.

If your claim deals with higher compensation, you will need to take your case to civil court. In this situation, it is highly advisable that you hire a personal injury attorney as your legal representation especially since so much compensation is at stake.

In civil court, a judge will decide the amount you are due, and the insurance adjuster will have to pay that sum. Settling out of court is generally less stressful for everyone involved, so the majority of cases never have to go to the civil court stage.

Check out our infographic for a visual look at the steps of a claim settlement and how long it may take for you to receive compensation.


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