Why Do Insurance Companies Offer Low Settlements After Car Accidents?

After a car accident, it should be easy to make an insurance claim and get fair compensation. However, it is not so, and getting your first settlement offer from an insurance company only evokes uncertainty and worry. The reasons could be that the offer might have been lower than you expected and you are anxiously waiting to pay your bills.

In most cases, insurance companies frequently make low settlement offers, hoping that you might accept one quickly. It is not fair on their part to do such a thing, but after all, insurers are in the business of making money. They only care and protect their bottom line. In some cases, people could be accepting lower insurance settlements because of COVID, and because they desperately need the money.

So, if you are being offered a low settlement, which is very much less than you deserve then, what should you do? Instead of thinking and getting worried, you need to hire a lawyer, for example, a personal injury attorney or a car accident attorney depending on your situation.

woman on phone after car accident

Why Do Insurance Companies Offer Low Settlements After Car Accidents?

Here are some of the reasons why do insurance companies offer low settlements after car accidents;

The Settlement Offer Might Be Auto-Computer Generated: Computer-based estimates are often low or unfair because the software is designed to favor the insurance company’s interests over yours. That is why it offers and calculates low insurance amounts just enough to be tempting for you to accept while still ultimately protecting the insurer.

Usually, People Accept The Low Settlement Offers: Many people, without asking or raising any questions, accept the first settlement amount offered to them due to the lack of knowledge or because the lure of a quick payment tempted them. That is why insurance companies get away with offering such low settlements.

They Buy Off Your Right To Sue Them: By offering you a low settlement, the insurance company safely rips you of your legal right to sue them. When you accept the first low settlement offer, you lose your legal right to take any further action against the company if you observe damages after some time. So, always talk to your lawyer first and then sign or accept any offer.

They Believe You Won’t Consult An Attorney: One of the reasons insurance companies offer such low settlements is that they don’t believe you will do anything about it. However, hiring a lawyer sends a clear signal that you will indeed do something about it. As a general rule of thumb, insurance companies don’t want to go to court. The trial itself costs them money.

How To Get A Higher Settlement Offer?

The next big question is, how do you get a higher settlement offer? To answer this, let’s focus on some of the tips that can help you get what you deserve;

Make Up Your Mind Regarding Settlement Amount: It is better to decide on a minimum settlement figure you would accept. This figure is for your own information, not something to share with the adjuster. But it helps if you already have your bottom line in mind.

Do Not Accept The First Offer: When a first offer is made, think before accepting it. If the offer is fair in your opinion, you can make a counteroffer a little lower than your demand letter sum. That shows the adjuster that you are also being reasonable and are ready to compromise. A little more bargaining will help you get the final settlement sum you both think is just.

Seek Care For Emotional Distress: It is beneficial to mention any emotional points supporting your claim, for example, a photo of a smashed car or a severe-looking injury. If there was a bottle of beer found in the other driver’s car, refer to it as well. They can be very useful in getting an insurance company to settle an accident claim.

Provide Extensive Evidence And Documentation: The more evidence, the better. It would be highly effective for your attorney to present maximum evidence to the insurance adjuster, such as records of all hospital visits, financial costs, and any other evidence that could possibly demonstrate a lowered quality of life. This will make your case strong to get a higher settlement offer.

Engage An Attorney: Hiring an expert attorney will help ensure that the adjuster takes your claim more seriously. So with no further delay, contact us to consult an apt car accident attorney if you want to get a satisfactory settlement offer.

Hire a Car Accident Lawyer to Handle Your Case For You

You must always protect your rights after a car accident. If you believe that you have a case, or that your car insurance company is offering you a settlement that is too low, then speak with a car accident lawyer as soon as possible.

About The Author

Michael Steinger

Michael Steinger

The Florida BarFlorida Bar Young Lawyers DivisionMillion Dollar Advocates ForumMillion Dollar Advocates ForumBest Workers Compensation Attorneys in MiamiBest Car Accident Lawyers in MiamiLawyers of distinction

MICHAEL S. STEINGER, founding partner of Steinger, Greene & Feiner, believes in representing real people, not big businesses. Since the firm’s creation in 1997, Steinger, Greene & Feiner has never represented an insurance company or large corporation, and he vows to keep this promise. Over the course of his career, Michael has handled thousands of Florida accident cases, recovering millions of dollars for his clients and earning him membership into the Multi-Million Dollar Advocates Forum. Staying up-to-date on the ever-evolving laws protecting injury victims and their families, Michael is an active member of the American Bar Association, the Palm Beach, and St. Lucie Bar Associations, and sits on the Auto Insurance Committee of the Florida Justice Association.