Basics of Car Accident Settlements
For those who have suffered serious injuries in a car accident, the process of seeking compensation through an insurance settlement while going through medical treatment and missing time from work can be a bit overwhelming. Many describe it as a stressful process. Dealing with insurance companies is never straightforward, and there are many other considerations that have to be addressed.
At The Davis Firm, LLC, we want you to understand your rights and know what to expect during the car accident settlement process. However, we encourage you to get qualified legal help, rather than attempting to settle an injury claim on your own. After all, the insurance companies deal with these claims every day, and they have lawyers looking out for them. You should, too.
Steps in a Car Accident Settlement
After an auto accident, there are five basic steps in the settlement process:
- Medical Treatment. In order to get better, you’ll obviously need to get medical treatment. However, medical care also serves a separate purpose. It proves your injuries and documents how you were affected by the accident.
- Evidence Gathering. In most cases, once you reach a point where you are as good as you are going to get following the wreck, your attorney will need to obtain all of the relevant evidence like photos at an accident, police accident report, medical treatment records, billing statements, and documentation of other losses related to your injuries.
- Demand. The next step in the process is to issue a formal demand for settlement. At this stage, your attorney will provide the insurance company with a detailed summary of why compensation is due.
- Negotiations. Your attorney will then negotiate with the insurance company to see if it is possible to reach a fair and reasonable settlement agreement, based on your unique case. If so, you can work toward a resolution. If not, you and your attorney will need to discuss the possibility of filing a formal car accident lawsuit in order to resolve the case.
- Resolution. Once a settlement is tentatively reached, there is one last step. During this final phase of the case, your attorney will work to resolve any outstanding medical liens, bills, and health insurance reimbursement accounts. Once this is done, you will be able to settle your case and receive your check.
What Should Be Included in a Car Accident Settlement?
Depending on the case, there are several key types of compensation you may be able to recover in a car accident settlement. These include:
- Reimbursement for medical expenses
- Compensation for future anticipated medical bills
- Lost wages
- Future loss of earning capacity
- Pain and suffering
- Emotional distress
Keep in mind that while your attorney will likely argue for any and all potential compensation available to you, the final settlement offer rarely breaks it down by type of compensation. Instead, victims typically receive lump-sum offers. If that is what happens in your case, it will be up to you and your attorney to resolve liens, pay any attorney fees, subrogation liens, outstanding medical expenses, and case costs from your settlement amount.
How Long Does a Car Accident Settlement Take to Pay Out?
Every case is different, so it’s impossible to answer this universally. However, once the release agreement is signed, most insurance carriers will tender payment within about 30 days.
But this is just the very end of the process. Before you can reasonably sign a release and reach an agreement, it is important for you (or your attorney, if represented) to methodically ensure that every lien and medical bill is carefully considered and protected. If you receive Medicaid or Medicare benefits, then you need to ensure that you are protecting the government’s right to recover reimbursement, as well.
There are many factors that can delay you getting paid. For instance, maybe Medicare tries to claim reimbursement for unrelated medical care, and your attorney has to dispute the charges to save you money. Or, maybe a medical provider is unwilling to negotiate or reduce their lien, forcing you and your attorney to spend time-fighting unreasonable charges.
As you can probably tell, there are a lot of variables that cannot be perfectly predicted. Therefore, it’s best to work with a personal injury lawyer who has considerable experience handling car accident claims in Tennessee.
Watch for Liens
A lien is a right to be paid. Many medical providers who offer care after an accident will send your attorney and the insurance company a written notice of their right to be paid from your case. These are important because if you ignore one, you run the risk of being sued by your health provider. All medical bills and liens need to be considered when settling. This is crucial to know how much to ask for in a personal injury settlement.
Liens can also be submitted by health insurance companies, Medicare, Medicaid, or even child support or workers’ compensation carriers. Basically, anyone who has a right to recover reimbursement or payment from your case can issue a lien.
Are Car Accident Settlements Taxable?
In general, no. Personal injury settlements are considered non-taxable, except for certain limited exceptions. For instance, if you enter into a confidentiality agreement, some courts will say that your settlement can become partially taxable unless your attorney has expressly accounted for this by including special language in the settlement agreement.
Likewise, money received for lost wages can be considered taxable, but only if the settlement expressly calls the compensation reimbursement for lost income. Most do not make this distinction.
Are Car Accident Settlements Public Record?
It depends on whether the case is in litigation or not. The car accident settlement process is often handled exclusively outside of court and in private between you and the insurance company. If, however, the case should end up in court, then there are many parts of the case that will be public record.
Still, most of the time, the settlement agreement itself and the specific terms of the settlement are not subject to public disclosure. They are merely kept by you, your attorney, and the insurance company.
Why You Need an Experienced Car Accident Lawyer to Fight for You
There are a lot of ways you can go wrong when negotiating a settlement. First, you are emotionally close to the events. You may have personally dealt with the pain and agony of a lengthy medical recovery, or you may have struggled with financial difficulties since the accident. Having a professional who routinely handles these matters and who is emotionally detached from the events can be very helpful.
An attorney can also rely on years of experience and past dealings with insurance companies when negotiating a settlement. Your car accident attorney will know the tricks and tactics the insurance company may use, as well as how to combat them.
How Our Chattanooga Law Firm Can Help
For more than 15 years, attorney Scott Davis has represented injury victims throughout Chattanooga and the surrounding parts of Tennessee. If you need help with the auto accident claim process, you can count on skilled and knowledgeable Chattanooga personal injury attorneys at The Davis Firm, LLC for legal advice and smart settlement strategies. Contact us today to get started with a free initial consultation.