If You Still Need Help

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Not all claims can be settled successfully without an attorney, especially for the amount of compensation you deserve. Every accident is unique in terms of the damages it causes, the liability that led to it, the value as determined by policy limits and geographical market, and the willingness of an insurance company or adjuster to settle for a reasonable amount of compensation. Unfortunately, this means there is no comprehensive step-by-step guide to encompass every facet of every possible personal injury claim. There are simply too many factors involved in a case to reduce the personal injury claims process to a formula.

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If you’ve tried every suggestion but have still been unable to attain a settlement that you feel satisfied with, it may be time to talk to a lawyer. Photo Credit: Pixabay (free-to-use Pixabay License). 

It can be difficult to make the decision to turn your claim over to a professional. For one thing, you’ve already put so much time and effort into building the case that it’s understandable for you to want to finish it on your own. Maybe part of you feels that settling the claim yourself will give you some kind of closure regarding the accident and the impact is has made on your life. Unfortunately, while settling your claim might be an accomplishment to celebrate, it likely won’t translate into any emotional closure. If you settle for less than you deserve, your claim won’t do much good for your family financially, either.

Do the Math

If you believe your claim is worth far more than the insurance company is willing to consider, your case may not be a lesser-value claim at all. It may be worth paying the attorney’s fee to have an experienced lawyer represent you.

First, though, you should know what kind of fees you’re getting into. In New Jersey, the law requires that the other costs of pursuing the claim are deducted from the total settlement first. Then, attorneys collect no more than one-third of the remaining settlement money. In Pennsylvania, the costs don’t have to be deducted before the fees, which means lawyers will get a larger share of the settlement. You can expect to pay between 33 and 40 percent of your settlement in attorney’s fees in PA.

Why should you consider giving up such a big chunk of your settlement? It’s a fact that lawyers recover more than claimants who pursue a claim without legal representation. Some insurance companies have estimated that attorneys typically attain as much as 3.5 times the settlement amount claimants get when working alone.

The question isn’t whether a lawyer will be able to get you more money than you can get on your own – unless you already are recovering the full policy limit amount of coverage, he or she will. The question is whether the amount of money you could gain is more than the cost of lawyer’s fees.

Let’s break down the numbers:

Example 1: New Jersey claim with $15,000 policy limit

Suppose an automobile accident with a person who has only the minimum $15,000 coverage amount leaves you with damages that the insurance company values at $9,000.

Because the policy limit in this specific claim is low, the lawyer could really only recover $15,000 for you, or approximately 1.6 times the amount you were already getting for yourself, rather than the theoretical 3.5 times the original settlement offer ($31,500). Then the lawyer would collect one-third of the settlement as payment (for simplicity’s sake, and because this was a lower-value claim, let’s ignore the potential cost of pursuing the claim in this example).

Settlement you received for yourself:

–           0 (subtract fees – in this scenario, none exist)
$9,000 in your pocket

Settlement attained by a lawyer:

–   5,000 (subtract attorney’s fees – 33 percent)
$10,000 in your pocket

In this scenario, having the help of an attorney doesn’t gain you much. At least some of that extra $1,000 will likely go toward case costs other than lawyer’s fees, so you will end up with about the same amount of money despite getting a larger settlement. If you’ve already negotiated the $9,000 settlement with the insurance company, you may not want to wait to get your money, which you will certainly have to do if you hire an attorney to negotiate a larger settlement for you.

In this case, you probably should take the $9,000 settlement you negotiated, and not hire an attorney.

Example 2: Pennsylvania claim with $15,000 policy limit

Now imagine a similar situation occurring in Pennsylvania instead of New Jersey, where attorney’s fees may be up to 40 percent.

Settlement you received for yourself:

–          0 (subtract fees – in this scenario, none exist)
$9,000 in your pocket

Settlement attained by a lawyer:

–  6,000 (subtract attorney’s fees – 40 percent)

This leaves you with the exact same amount either way, right? Not exactly. Remember that there will still be some costs associated with your clam, and that in Pennsylvania, attorneys can take their payment before deducting those expenses. The final amount of money in your pocket will actually be less than $9,000.

In this case, you are actually better off proceeding on your own instead of hiring a lawyer.

Policy limits play an important role in determining whether or not you should hire an attorney. In the two examples above, the low policy limits mean that a lawyer can’t increase the value of your settlement enough to really make hiring an attorney a worthwhile choice for you. You may receive approximately the same amount of money as you would have on your own, or you could even end up with less money. Honestly, attorneys may even turn down the opportunity to handle your claim, knowing that it won’t result in a settlement that will justify the use of their professional resources and that you won’t really benefit from their services.

In a claim in which more insurance coverage is available, though, having an attorney can make a much bigger difference.

Example 3: New Jersey claim with $100,000 policy limit

Suppose you are involved in a somewhat more serious automobile accident with a person who has $100,000 in coverage. You have some severe injuries that required costly medical care, and you missed work for some time. The insurance company refuses to go higher than $20,000, even though the policy limits allow for far more compensation.

Depending on other factors regarding the claim, this could be a relatively high-value case. Perhaps the lawyer will succeed in getting a settlement as high as 3.5 times the one you originally negotiated, or $70,000.

Settlement you received for yourself:

–            0 (subtract fees – in this scenario, none exist)
$20,000 in your pocket

Settlement attained by a lawyer:

–  23,100 (subtract attorney’s fees – 33 percent)
$46,900 in your pocket

Of course, there will still be costs associated with pursuing this claim. Because it is a higher-value claim that will probably require more negotiation than one that results in a settlement worth only a few thousand dollars, those costs might be higher than in a low-value case. However, this is a situation in which you should clearly hire, or at least consult, an attorney. You could more than double the amount of compensation you receive, just by getting the help of a professional.

Example 4: Pennsylvania claim with $100,000 policy limit

Now imagine a similar situation occurring in Pennsylvania instead of New Jersey, where attorney’s fees may be up to 40 percent.

Settlement you received for yourself:

–            0 (subtract fees – in this scenario, none exist)
$20,000 in your pocket

Settlement attained by a lawyer:

– 28,000 (subtract attorney’s fees – 40 percent)
$42,000 in your pocket

Remember that there will still be some costs associated with your clam, and that in Pennsylvania, attorneys can take their payment before deducting those expenses. However, though you are recovering less money in this scenario than in a similar scenario that occurs in New Jersey, the increase in the final amount of money in your pocket is still significant.

Keep in mind that market value is just as significant in a claim that a lawyer is handling as it is in a case you handle yourself. An accident in a city like Philadelphia is likely to result in a higher settlement than an identical case that originated in a less urban area. It’s also a plus that an attorney should have enough experience to know the market value and avoid settling for less money than you deserve.

If you’re having difficulty negotiating with the insurance company and they are unwilling to offer you a settlement that seems fair, consider why it’s so important that you avoid hiring an attorney. If there’s another reason besides money, consider whether settling the claim yourself will realistically give you the sense of accomplishment or closure you’re hoping to get. If the reason for pursuing the claim yourself is purely financial, break down the numbers of your own claim just as we did in the examples above. Is there a possibility that your claim could be worth far more than the cost of attorney’s fees? Remember, whether you settle a claim on your own or hire an attorney to do it for you, you’re taking a gamble either way – but it doesn’t hurt to boost the odds in your favor by making the smartest strategic decisions you can.

Do the Potential Gains Outweigh the Potential Losses?

If you’ve already gotten the insurance company to negotiate with you but simply aren’t happy with the offers they have made, you have little to lose by hiring an attorney. Having representation certainly won’t negatively affect the settlement amounts that the insurance company is willing to offer.

While it’s possible to lose a lawsuit and end up with nothing, only about two percent of tort claims – civil claims like personal injury claims that seek compensation for damages caused by another party’s behavior – ever go to trial, anyway, Statistic Brain reported.

However, it’s common for claims to enter the litigation phase, in which the claim officially becomes a lawsuit, before the insurance company will realize that it would be a mistake to take that claimant to trial and offers a better settlement. Allowing a lawyer to pursue a lawsuit on your behalf may make sense if you can’t get the amount of compensation you want through your own negotiations. Lawsuits are more costly than straightforward settlements, even if they don’t proceed to trial, so more costs will be deducted from your compensation.

One thing you don’t have to worry about is the possibility of losing your case and owing a lot of money. Most personal injury lawyers typically operate on a contingency basis, which means they don’t charge their clients unless they actually recover money.

Even if you’re at the later stages of pursuing your claim, it’s a good idea to cash in on free consultation offers from lawyers. Generally, if an attorney thinks it’s worth putting the time and financial resources into pursuing your claim, there’s a good chance that your case has a high enough value to warrant spending that extra attorney’s fee. If a lawyer doesn’t want to represent you, at least you will have the opportunity to ask a couple of questions about your claim and use a professional’s knowledge to decide what to do next.

It’s Not Your Fault – It’s Theirs

Sometimes no matter how hard you try, you won’t be able to get the insurance company to provide you with the settlement you deserve – or, for that matter, any settlement at all. That’s because insurance companies will sometimes act in bad faith. Bad faith is the legal term that describes a situation in which an individual or organization consciously and willfully misleads or deceives another. In the circumstance of an auto insurance company, bad faith is what’s called a “breach of fiduciary duty,” or a breach of contract.

Often, acts of bad faith happen when your own insurance company refuses to act as promised in your policy. For many claimants, this never becomes an issue. You deal with the other party’s insurance company, you get a settlement, and the claims process is complete. However, imagine that your accident involved a policyholder with low amounts of coverage. If your damages exceed the policy limits of the at-fault party, you may be able to turn to an underinsured motorist portion of your own auto insurance policy, if you purchased that option. You would then negotiate with your own insurance company just as you would (and did) with the insurance company of the at-fault party.

The process sounds simple in theory, but imagine that you shelled out the extra money to purchase this optional underinsured motorist insurance, only to find that when you needed to use it, your insurance company left you hanging. At our office, we’ve seen some pretty appalling examples of bad faith. Some insurance companies have simply refused to act at all, pretending that they never received notification of the underinsured motorist claim. Others have attempted to hide documents or even argued that the claimant is not covered by the policy, despite clearly being named on the policy. These companies refuse to provide the promised benefits. They make absurd excuses for denying or delaying claims that are clearly legitimate, just to protect their own profits at the expense of your family.

If your insurance company is acting in bad faith, there’s little you can do alone to get a settlement. Even lawyers have a hard time convincing these defiant insurance companies to cooperate. Bad faith claims are separate from personal injury claims. Often, they turn into lawsuits and even go to trial before attorneys can recover the money claimants like you deserve. In Pennsylvania, laws even allow attorneys to seek punitive damages – meant to punish the insurance company for its unlawful behavior – on your behalf, as well as court costs and lawyer’s fees.

Just as choosing to get help with your claim requires consideration, so does selecting a lawyer to represent you. If you do decide to get professional legal help, make sure that the attorney you choose has experience in personal injury law in your state. While some insurance adjusters may be impressed by a law firm’s letterhead or the “Esq.” suffix that follows the signature, you can’t depend on a job title to make the difference in your claim. Success in personal injury law requires a special kind of persistence, savvy negotiating skills, knowledge of the area’s legal market, and commitment to demonstrating liability and preparing evidence and demands. “All-purpose” is not a characteristic you want in an attorney handling your personal injury claim. Handing off a claim to a lawyer inexperienced in this discipline of law may generate little more success than you managed to find yourself.

If you’re still in the process of pursuing your claim on your own and you’re not ready to give up just yet, read the previous installments of How to Handle Your Own Personal Injury Claim for our tips, tricks, and step-by-step instructions to help you get the settlement you deserve.

Disclaimer: Results may vary depending on your particular facts and legal circumstances.

This article was professionally reviewed by Richard P Console Jr, an attorney licensed to practice in New Jersey, New York, and Pennsylvania.

Mr. Console has more than twenty years experience practicing personal injury law and successfully resolving vehicle accident claims on behalf of his clients.

Learn more About Richard P Console Jr.

While this information was reviewed for accuracy, it should not be considered legal advice. Every claim is different. If you are thinking of pursuing a personal injury claim and have a question contact us directly. 

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