Want to Settle Your Own Accident Claim? Part 3 – The Demand

Settle Your Own Accident Case Part 3Having decided whether you should try to settle your own accident case (Part I) and gone through the preparations and document gathering needed to prepare your demand (Part 2), you should now be ready to draft your settlement demand letter. This will take some time, and you will need to review and refer to many documents, particularly your medical records, so don’t expect to knock this out in just a few minutes.

Writing a Demand Letter — Your First Settlement Offer

In theory, you could just call the defendant’s insurance company and tell them how much money you demand to settle your claim. This is not how lawyers do it, and for good reason. By presenting your first offer in the form of a demand letter, you get to present not only your initial settlement offer, but also the grounds for making such an offer in a well-thought-out, organized fashion. It lets the insurer know that you’ve actually put some thought into your offer and that you’re more sophisticated than the average “lawyerless” claimant. In other words, you are not someone to be messed with.

My suggestion for how to organize and present your demand letter is just that — a suggestion. You should consult other sources or buy a book and combine my advice with that of others to find an approach that works best for you. Here is how I suggest your settlement demand letter be structured:

The Claims Information Section: Between the insurer’s address and “Dear Sir or Madam”, you should have a block of information that quickly lets the adjuster know the following:

  • Name of Claimant: <your full name>
  • Name of Insured: <the name of the tortfeasor — either a person or business>
  • Policy Number: <the policy number of the tortfeasor if you have it>
  • Claim Number: <if the insurer gave you a claim number, enter it here>
  • Date of Loss: <the date of the accident>

The Introduction: In the first paragraph, you want to state that this is a time-limited demand to settle the above-referenced claim and that the offer to settle will lapse and be revoked unless you receive a settlement check in the amount demanded (don’t specify an amount here — wait until the end of the letter) within 30 days. Thirty days is standard for such a demand. It has the additional benefit in cases in which you are requesting policy limits of preserving your right to bring a bad faith lawsuit should the policy limits not be paid.

Give a very brief description of the accident, such as “the automobile accident which occurred on “X” date, or the “slip & fall accident which occurred in “X” store. You then state that “The particulars of the claim are as follows:”, and you begin your section-by-section description of the claim. For each of the following sections, I suggest you use the actual bold headings I provide in your letter so the adjuster knows how the claim is organized.

The Claimant: Here, you state your full name, age and gender (e.g., John Doe is a 35-year-old white man) and provide any useful information about yourself from prior to the accident, such as your occupation and the status of your health (e.g., . . . who worked as a truck driver for the past 10 years and was in excellent health). If you had no prior medical conditions, say so. If you did, here’s your chance to try to minimize their impact. You should disclose pre-existing conditions (the insurer will find out eventually), but you should distinguish them from the injuries you suffered in the accident (either you had fully recovered and this is a re-injury, or the accident exacerbated them) or state that they are unrelated to the injuries from the accident (e.g., you had a prior knee surgery, but you are not claiming a knee injury from the accident).

If you are married and/or have children, include that here. Feel free to include anything that humanizes you so that the adjuster may see you as more than a number (charity work, community activities, etc.) or anything that may be relevant to the claim that you are making (hobbies or sports that you like that you will later say have been affected by the accident).

Description of the Accident: This is fairly self-explanatory, but I suggest that you only give the level of detail needed to convey the essential facts. If you were in a car accident, for example, you wouldn’t need to say where you had been or where you were going at the time of the accident. You don’t need to describe your emotions or what a horrible person their insured is. Think more along the lines of what appears in an accident report — the where, the when and the how.

Liability: Because this follows the accident description, this should just be a very short statement of why their insured is at fault for the accident. For example, “It is clear from the above description of the accident that your insured is 100% at fault and that there was nothing I could do to avoid the accident”.

Injuries Suffered and Medical Treatment Received: This section is also fairly self-explanatory. Be thorough as to what parts of your body were injured. Include everything, not just the worst injury. Use your medical records (which you should have gotten before you started writing) to help you give a summary of the treatment and tests you received, as well as their level of success (keep it to a summary — you’ll be sending the medical records with your demand). Identify any prescription medications you have taken and if you will need to take them in the future. If this is an automobile accident case in a “no-fault” state, be sure to state which of your injuries, if any, are permanent.

When you’ve finished describing all of your past care, describe the types of future care you will need (according to your doctor). Include any drugs you will have to take, any physical therapy or follow-up doctor appointments you will need. If you will need to do daily exercises at home from now on to maintain your current level of functioning, include that as well.

Economic Damages: In this section you will describe both your past and future “economic damages,” which will mainly be your medical costs and wage loss. Use the information from your medical billing documentation to add up your health care costs. Be sure to include your drug costs (your health insurance info should help). Use the full amount the health insurer had to pay, not just your co-pay (don’t forget that you’ll have to pay back your health insurer). Remember to include the cost of all of your anticipated future medical care, including drugs you will need to take. If you’re not sure how much certain treatments will cost, this site may help.

For your wage loss claim, include any “sick time” that you needed to use due to your injuries. If you lost your job, or had to take a less physically demanding job, include the total loss or difference in your pay going forward into the future as part of your future wage loss claim. Guesstimate if you don’t have exact numbers — just be reasonable in your estimation.

Finish this section by totaling your past and future economic damages (for easy reference). Say that your “future” economic damages figures are conservative and will likely be much higher if you have to litigate.

Settlement tip

Non-Economic Damages: Your non-economic damages are your pain and suffering (physical) and emotional distress (mental) damages. Describe both the pain from the accident and from your medical treatment — it’s all recoverable. Describe your current level of pain and how you will have to live with that for the rest of your life. If your injuries put you at risk for future arthritis (many injuries do — ask your doctor) state this and describe how this will cause your pain to increase in the future.

Describe any physical limitations that you have now, such as lifting or range of motion restrictions. Identify some of the things that you used to love to do but can’t do now because of these injuries (playing with children, golf, bowling, etc.). If you’ve gotten depressed, especially if you’ve treated with a mental health care provider, include this information (don’t forget to include his bills in the economic damages section, either).

Finish this section with a broad figure that encompasses both your past and future non-economic damages. Make it a large number because this is where you will be padding your demand for negotiation purposes. Don’t be conservative at all with your number (but say that you are).

Demand for Settlement: This section is your summary, wherein you list the different dollar amounts for the economic and non-economic damages you’ve previously identified and total them into the final demand for settlement. If the number seems too low to you, go back and tweak some of your other numbers (but not the past medical or wage loss, as those are fixed), such as your pain and suffering or future wage loss.

Come up with a number that is far higher than you want to receive as your final settlement. Don’t be naive and think that you’ll impress the adjuster with your reasonableness. Adjusters know that initial offers are exaggerated and expect you to negotiate down from them. If you start off reasonable, you’ll be negotiating down from “reasonable”.

When you’ve finished your demand letter, have someone else proofread it for you (not medon’t even ask) and make sure it reads well. When you’re satisfied with the letter, send it, along with copies of all of your supporting documentation, to the insurer.

Special Notes for Car Accident Cases

Property Damage: If you were in your own car at the time of the accident, you probably also have a claim for the damage to your car. This should be handled by a different adjuster at the insurance company than the one handling your bodily injury claim, a “property damage” adjuster. As this article is already quite long (and getting even longer), I’m not going to address how to settle your property damage claim. You can buy a very cheap guide which shows you how to handle that aspect of your case by clicking this link.

Settlement tip

You can handle your property damage claim immediately after your accident without waiting for your bodily injury claim to ripen. Just make sure that you don’t give any recorded statements to the adjuster (I’m assuming the accident report will state that the other driver was at fault). Inspections of your car are fine, and expected. Be sure that any release you sign as part of your property damage settlement does not release the insurer from your bodily injury claim.

Uninsured/Underinsured Motorist Issues: If you are sending a demand to an underinsured driver’s insurer (you’ll be demanding policy limits), to be safe you should make the settlement contingent upon the agreement of your own UM insurer. Just include a line in the final section of the letter stating that. In some states, such as Florida, if you don’t get the approval of the UM insurer before settling with the tortfeasor, you waive your right to collect UM insurance.

You can send practically the same demand letter to your UM insurer that you sent to the tortfeasor’s bodily injury insurer. Just add a section stating the policy limits of the underinsured driver and include a copy of the paperwork which supports those policy limits. When you make a settlement demand to your UM insurer, remember to deduct the policy limit amount of the BI insurer from the total settlement value. So, if your settlement valuation comes to $60,000.00 and the BI insurer has $25,000.00, you would demand $35,000.00 from the UM insurer (or its policy limits, if they are lower).

What Happens After the Settlement Demand Goes Out?

Mark your calendar to note the day your demand expires. Hopefully, you’ll hear from the insurer before then, either by mail or by phone, with either an acceptance of your offer or a counter-offer. If you do not hear from the insurer by the deadline, and think that you may have grounds for a bad faith case, you should call a personal injury lawyer and bring your demand package in for him to review immediately. If you don’t think you have a bad faith case, it’s up to you whether you want to contact the insurer to check on the status of the demand or just hire a lawyer.

Don’t try to trade numbers back and forth with the adjuster during a single phone call to settle your claim. Take some time to consider his counter-offer. Make notes about anything he identifies as weaknesses in your case, or reasons for not offering more money. Look into his claims and form counter-arguments before making a counter-offer of your own. Take your time and don’t try to rush things. Remember that smaller moves may make the process take longer, but they are safer.

Negotiating Tip: Often, parties trying to settle a claim use their offers to send a message to the other side about where they ultimately want the settlement to go. Pay attention to number in the middle of the two offers (e.g., if you’re at $50,000.00 and he’s at $10,000.00, $30,000.00 is the middle — just add the last two offers and divide that by 2). If the adjuster’s offers are increasing at a lower rate than your offers are decreasing, it means he’s trying to pull the middle number down.

Usually, parties to settlement negotiations want to get to the point where they can “split the baby” and reach a settlement. Keep this in mind when making new offers. If the adjuster isn’t moving enough, make your own moves smaller to send the message that you see the “ultimate settlement figure” as being higher than him. Note that this “middle seeking behavior” doesn’t really happen until after the first one or two offers, after your opening number has come down into a more reasonable range. So, don’t be too reluctant to make a large move in the beginning — it may be necessary to start talking real numbers. Use some of the padding you’ve built in to your offer to make that move.

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When to Bail Out and Hire a Lawyer

If, after trading a few offers with the adjuster it appears that you two are on different planets when it comes to valuing your case, you may want to just have a lawyer take over before your offers get too low. You don’t want a potential lawyer to be boxed in by your lowest possible settlement offer, as it will be very difficult for him to ever negotiate higher than that (and he’ll have to if you want him to offset his fee in the process). Don’t jump just because the adjuster’s first offer is low — this is a natural response because your first offer will always be too high. You’re just going to have to use your instincts to tell you if it looks like the settlement isn’t going to reach a number you can live with, so you know whether you should press on or hire a lawyer. That’s just one of the burdens of trying to settle on your own. Good luck!

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33 Responses to Want to Settle Your Own Accident Claim? Part 3 – The Demand

  1. grant says:

    I have a case I hope. Nature’s Miracle which claims to be safe for pets cause my cat to get really sick. In short it cost 4300 due to all the tests they ran trying to find out the problem. It turns out isopropyl alcohol the main ingredient in the product made him very sick. Now they are trying to deny responsibility. DO I have something? Not sure where I should have posted this but you have been great answering about my personal injury case.

    • fl_litig8r says:

      Unless there’s a class action out there against Nature’s Miracle for this issue, you’re going to be hard-pressed to find any lawyer willing to take this case. Given its low value relative to the cost of hiring an expert to prove causation, it wouldn’t be worth pursuing for just a single case. Hunt around online to see if there’s a class action forming. If not, at least see if there are other people complaining about similar issues from this food who you may be able to contact. If you can get enough people together to justify the cost of the expert, you’ll have a better chance at finding a lawyer.

  2. Are you any relation to dennis beaver? He gives you big props. Do you monetize your site? I think you have said some good stuff here. Just hard to concentrate with all the adds.

    • fl_litig8r says:

      No relation to Dennis. I just collaborated with him on one of his articles after he contacted me through this site. Glad to hear that he speaks well of me. I think he’s a pretty cool guy, too. My site is monetized through those unfortunately distracting ads and my $10 tip.

  3. Jonathan says:

    I currently am amidst a settlement after a Car accident Injury caused by a couple visiting from the UK in a rental car. I did not establish a letter of demand prior to the accident and since we are now six months post accident I have received an offer from the insurer for a little over $8,000 ($5000 for medical, 3 for pain & suffering) in addition to the offer for the automobile. I experienced a laceration to my head which required 5 staples and bled heavily. I don’t know where to start negotiations as they have made an offer & would like to keep from lawyering up at this point but don’t know where to start a counter-offer, and or have them retract their initial offer… where do I go from here? any guidance would be great

    • fl_litig8r says:

      Well, does the offer fairly compensate you for your medical costs? If you used your health insurer to pay these bills, you will have to pay it back from the settlement. So, you need to make sure that whatever you settle for will cover that repayment and still leave you with enough money to be satisfied. If they haven’t offered enough to cover your medical bills, start with that. Send them an offer thanking them for their offer, but conveying why you believe it is not adequate compensation for your injuries. If you have a scar from your head laceration, include pictures (if they will help — if you can’t see it now, don’t bother). If you missed work, tell them the amount of your lost wages (if you used sick time, you’re still entitled to be paid from them to cover your lost sick time).

      I really don’t know how much your case is worth, so I can’t tell you any numbers to throw back at them. You should ask for more than you want, to leave room to negotiate, but not be ridiculous with the amount.

      • Jonathan says:

        Thank you, what you said is helpful… I guess its hard to determine a value for your pain and suffering, because I’ve been taught my whole life to get up and shake it off… the injury has healed and there isn’t much scaring (they already told me to send a picture and i did) and the 5,000 covers the medical bills as i didn’t seek much follow up treatment. I paid the bills initially out of pocket due to the fact the insurance company was moving so slow, so the 5,000 would reimburse me for my initial costs. I guess my major concern is if I counter-offer, is there a chance they would just completely stop negotiating? at this point I don’t want to be forced into obtaining legal counsel, but i don’t wanna be naive and just except the first offer either. Part of me wants to just say can we do $10k & be done with this? But i know thats not how this works… Is it possible that if I countered with 12k they could just stop negotiations entirely?

        • fl_litig8r says:

          I’ve never had an insurer revoke a settlement offer just because I made a counter-offer. I’d expect that if they don’t like your offer, they’ll just say that their last offer is all they can do. While it’s always possible for them to rescind the offer, there is no logical reason for them to do so — if they’re willing to pay that amount today, why not tomorrow as well? I just never see this happen.

          Insurance companies aren’t delicate little flowers who will storm off in a huff if you make a counter offer that they don’t like. If they’ve reached their top dollar, normally they’ll just say so and still leave the offer open.

          I think a $12k counter to an $8k offer sounds reasonable. I can’t see that upsetting anyone. If they don’t want to come up, expect them to say “sorry, $8k is all we can do.” Hopefully, they’ll offer to split the baby and meet you at $10k. Even if they just come up $500.00, it’s well worth your time in making the counter-offer.

  4. sh says:

    Simple question- when addressing and actually mailing this demand letter- do I need to send a copy to the defendant? The person who hit me and not just their insurance company? All I have is the person’s name and basic insurance info given to me after the accident- I don’t have a mailing address for this person.

  5. Qwertz says:

    Thank you for all of the useful tips and advice in this website. I feel like I’ve gotten a great deal of information.

    Here’s my situation, we are in PA. My young child and I were in a store when a person drove through the window hitting us. My injuries were more severe than my child’s and included a head injury, stitches, scars and eventually surgery to repair tendons and ligaments. I am attempting to handle this on my own. The insurance adjuster feels that our claim may go beyond the driver’s policy limits and go into our UM as well. I have a couple of questions – first when putting together my demand letter, I will include my costs, a summary of the medical bills, I also have pictures of myself from the injury. Do I need to include a starting number? Wouldn’t it be in my best interest to let them give the first number? Knowing in advance what the limits of the policies are, I didn’t want to reduce what I can get by a third by using a lawyer. (Perhaps you think differently?)

    Let’s say the insurer does not go to policy limits and I decide to hire a lawyer. Would a lawyer be open to an agreement where I pay them 33 1/3 to 40 percent of the amount they can get me above what I had already been offered?

    Lastly if I have future medical bills related to this incident, will I need to pay my insurance back?

    Thank you!!

    • fl_litig8r says:

      Traditionally, the plaintiff makes the first settlement demand. It’s not a hard and fast rule, but it will be expected if you are sending them a formal demand package.

      As far as using an attorney, it is always a question of whether you think you can do better on your own than you would if a fee had to be taken out. Because your case involves a child, your settlement will likely require court approval. Often, if the plaintiff doesn’t have a lawyer, the defendant will pay an attorney to see that this is done. However, this attorney will work for the insurer, not you, so there is some trust involved in letting him handle this aspect of the case. Usually, it won’t be an issue.

      Don’t expect lawyers to be willing to base their fee only on the amount of the recovery that exceeds your prior negotiations. We don’t like encouraging people to handle matters on their own, as often people will screw up somehow and make the case more difficult than if we had taken it from scratch. Giving a discount to such people (as you’ll almost always get an offer of some kind) is just not in our best interests. Plus, if you’re going to a lawyer after trying to settle on your own, he knows that you’re not happy with what you could get without him, so you don’t hold a lot of leverage. I think a better suggestion would be to try to get the lawyer to guarantee you at least the amount you had previously negotiated after he takes out his fees and costs. This way, you don’t wind up losing money by using him, and he still has the chance to recover a full fee. At worst, if he just gets you the same amount you would have gotten on your own, you got his work for free.

      With respect to your health insurer, I’ll refer you to this article. The short answer is “probably yes,” but as with most legal questions, it’s more complicated than that.

  6. ST says:

    Hello. I feel this is a good article with good comments and replies. I have a thought which is not addressed here and I wonder how it is typically handled.

    The question is: Would it be reasonable to include a settlement demand figure that you suspect may exceed the at fault driver’s policy limits but you are not sure because the at fault driver’s insurance company will not disclose the amount except to say that it equals or exceeds my UM/UIM coverage?

    Here are details: I was injured in an auto accident several months ago that caused injury resulting in medical bills of $75k present, $25k future; lost wages of $50k present, $15k future (total of $165,000). In consulting with an attorney a couple months ago and reading statistics, it appears I may be able to recover for pain and suffering around $200,000. Thus, grand total (ignoring other damages) is approximately $365,000 ($465,000 if I “pad” the number for negotiating purposes). MY UM/UIM limit is $250k.

    I know the at fault driver has a policy of 250k or greater, but the insurance adjuster for the at fault driver will not confirm unless I sue. I am trying to do this on my own and want to avoid a lawsuit. I suspect their policy limit is $250k also, but I cannot be sure. To repeat from above, would it be reasonable in my demand letter to simply state a demand for $465,000?

    • fl_litig8r says:

      I would ask for the $465,000.00. Let them come back and tell you that they are only offering $250,000.00 because that is the policy limit. I see no reason to assume that they only have $250,000.00 in coverage just from the information you have and possibly shortchange yourself by only asking for that. If your demand is well beyond their policy limits, that’s their fault for refusing to tell you what the limits are. If they come back with a counter of $250,000.00, make sure you know that this is the policy limit before you consider accepting it. If they still won’t tell you after making such an offer, I’d tell them (assuming you feel this way) that I would be willing to take the $250,000.00 only if they confirm that this is the policy limit. Otherwise, you’d have to hire a lawyer and sue them, as without a confirmation that they are offering limits, you could be leaving over $200,000.00 on the table. I think if they still won’t tell you that this is a sign that the limits are higher than $250,000.00, as they may be risking a bad faith lawsuit if they blow a policy limits settlement just because they refused to tell you their limits. Now, in some states, the insurer is required to get the insured’s consent to disclose policy limits, and the insured may be the one telling them not to tell you. This would likely preclude a bad faith case. If they refuse to tell you the limits after the negotiations discussed above, I’d ask them plainly if their insured is the one who won’t give them permission to disclose his limits. If he is, I’d urge that insurance adjuster to explain to him that if he only has $250,000.00 limits and blows this settlement, he will be personally liable for any amount you recover above that $250,000.00 at trial. See if they’ll take another run at him to get that consent.

  7. DL says:

    I was driving my car when a drunk driver rear ended me, sending me into on coming traffic. Luckily for me I avoided cars and trees, finally coming to a stop several hundred feet away from the impact. The drunk driver hit a telephone pole[splitting it in three places] jumped from his car and ran away. The police eventually caught the drunk driver and arrested him for aggravated DWI and leaving the scene of a accident were an injury occurred. This was clearly 100% drunk drivers fault. My car was completely totaled [he hit me with such force that the rear glass window of the my SUV was pushed into the back seat. My family found several items that were in the back [ sneakers, books]scattered over the road when they had been blasted out of the rear window. I received a concussion and resulting injuries to neck, back and shoulders. Also bruising to left lower leg. I have been treated for severe migraines resulting from this accident [very strong meds and physical therapy]. Physical therapy stopped after 3 1/2 months when no fault insurance deemed I was better. I have no medical insurance so continuing was not a option and I continued at home on my own as best I could. Since NY is a no fault state, my car insurance covered most medical bills and I was given a check to cover totaled car[definitely not enough to cover replacement]. I would like to sue drunk driver for my non economic damages and several bills that were not completely covered by my car insurance but his insurance company will not offer settlement stating that I don’t met one of the nine standards under NY law. Any suggestions on how to proceed.

    • fl_litig8r says:

      As in many no-fault states, you cannot recover any non-economic damages (pain and suffering and emotional distress) unless you meet a certain injury threshold defined by statute. Under New York law, you must have a serious injury, which is defined by N.Y.ISC.LAW §5102(d) using nine standards (this is what the adjuster is referring to). These nine standards for a serious injury are:

      1. A personal injury that results in death;
      2. Dismemberment;
      3. A significant disfigurement;
      4. A fracture;
      5. The loss of a fetus;
      6. Permanent loss of use of a body organ, member, function or system;
      7. Permanent consequential limitation of use of a body organ or member;
      8. Significant limitation of use of a body function or system; or
      9. A medically determined injury or impairment of a non- permanent nature which prevents the injured person from performing substantially all of the material acts which constitute such person’s usual and customary daily activities for not less than ninety days during the one hundred eighty days immediately following the occurrence of the injury or impairment.

      Some of these standards are notably vague, as discussed in a New York lawyer’s well-reasoned blog posts here and here.

      Additionally, against another vehicle covered by New York no-fault law, you cannot recover any damages for “basic economic loss”, defined in N.Y.ISC.LAW §5102(a). This includes all of the damages that are part of your $50,000.00 no-fault coverage — notably, you cannot recover the 20% of wage loss not paid under this coverage or any amount not paid due to a deductible. If your economic damages exceed the $50,000.00 coverage, you can still sue for that.

      In short, if your injuries don’t meet any of these nine standards, you can’t recover any non-economic damages, and you would not be able to recover your economic damages if the other driver had NY no-fault coverage and your economic damages were less than $50,000.00.

      I’d suggest that if you think your injuries meet one of the serious injury standards, you should try to retain a New York lawyer (or at least get a free consultation to see what he thinks about your chances of proving a serious injury).

  8. Tara says:

    Great site! Im helping my mother with a claim from Walmart in which she fell on something left on the floor. She has not received MMI yet, but may be close. Some of the bills were paid by Medicare under their allowance but they will look for reimbursement. Can I include a subrogation statement in the demand letter indicating that Walmart deal directly with Medicare and we use the remaining settlement $ and negotiate an amount to be paid on the balance for other insurers and providers?(I do NOT want to deal with the government on this, and I suspect Walmart will negotiate with Medicare directly….but not sure) Medicare has paid such a small % on these bills, but they are also overinflated. The “billed” amount which includes emergency treatment and followup surgery and physical therapy will probably total 70k. Walmart has indicated she will be paid pain and suffering, but don’t know how much or what their insurance limits are :).
    Going to try to settle this for her, but I know my limits and when to get help. Ordering some additional references on the topic, too!
    Would appreciate your comments on the questions above.

    • fl_litig8r says:

      It’s nice that you are doing something so time-consuming and frustrating for your mother. With respect to policy limits, you don’t need to worry about that with Walmart — it’s self-insured, and it has plenty of money. Of course, the bad news is that Walmart is notoriously aggressive and stingy in its claims handling, often forcing litigation where most reasonable business would just settle. If you feel like you’re getting railroaded, consider hiring a lawyer.

      With respect to the Medicare lien, I can’t really say if Walmart would accept a settlement wherein it agrees to pay the lien and then negotiates everything else separately. On the one hand, most defendants want to settle everything in a lump sum, and not leave anything open-ended, such as the amount of a lien which is unliquidated. On the other hand, because you’re pro se, it may feel more comfortable paying Medicare directly to avoid any potential liability should your mother decide not to pay the lien from her settlement. It’s worth suggesting your idea to them, if you really want to avoid the Medicare lien issue. If you get stuck dealing with the lien, you should check out this site, which is the official website for the agency which processes Medicare liens. The information in the Attorney Toolkit and Beneficiary Toolkit sections is pretty informative (and contains forms you can use).

      • Tara says:

        Hi!
        Still working on my mothers claim(actually shes my mother in law)- Im preparing the demand letter- should it be directly from her or can I write it and sign it on her behalf? Do I need power of atty to do this? Or should I just write it like she’s writing it.
        Second question: Im going to ask for the full cost of the charges from each provider and a pain and suffering multiplier. The area she injured is an area where she had previous surgery. Does that make a difference? They may come back and say this was a preexisting condition, but she was healed and doing fine before the fall.
        Final question: The fees from the surgeon are outrageous and Medicare made a conditional payment (13k for surgery, medicare paid 2500)
        So I doubt Walmart will fork out 13k, but Im not sure the doctor will accept less or what medicare paid….very tricky because if I agree to 7k for example, and the surgeon comes back saying they want 9k, she cant afford that difference…..
        suggestions?
        Thanks so much for all you do…and by the way…Get some sleep!!:)

        • fl_litig8r says:

          1. I would recommend ghost writing the letter as if it were from your mother-in-law (and have her sign it). I had another commenter here who went the power of attorney route and got nothing but hassles and an accusation of unlicensed practice of law from the insurer. Save yourself that headache.

          2. Expect that they will try to make an issue of the previous surgery. You may want to address that head on in the demand itself and provide proof that she had completely healed and had not received treatment for that injury for some time before the accident. When you ask for your pain and suffering damages, don’t specify that you’re using a multiplier of the economic damages. That’s just a rule of thumb. Use the amount you calculate from the multiplier only, and explain that it’s fair just by referencing the amount of pain from the accident, the treatment, and any loss of ability to perform prior activities (loss of enjoyment of life).

          3. If the doctor already took the $2500 from Medicare, he can’t “balance bill” your mother-in-law for the rest. If you’re sure that Medicare already paid, feel free to demand the $2500 from Walmart. You’re right to assume that it won’t pay any more than that, if that payment was accepted by the doctor.

          I’ll sleep when I’m dead. ;)

  9. sh says:

    Truly a fantastic site!
    I’ve sent off my demand letter with a 30 day limit. I’m at day 20 now and I haven’t hear anything from the insurance company- no give or take-nothing. I have a postal certified mail receipt for the day I mailed the package of info…. If they just drop the ball am I looking at bad faith? Small claims? I expect this case to settle around $10K at most. This is Allstate which the adjuster (in CA) told me to mail any info to their scanning center in TX.

    • fl_litig8r says:

      You only have a shot at a bad faith claim if your lawsuit is worth more than the tortfeasor’s policy limits. Because you value the case at around $10k, that seems unlikely. When the policy limits are adequate to cover the claim, the only incentive the insurer has to meet your deadline is to avoid you filing suit.

      Before you rush off to small claims court, know that the California small claims limits for personal injury cases resulting from car accidents when liability insurance is available is still only $7,500.00. While the general small claims limit for most claims was raised in January 2012 to $10,000.00, it stays at $7,500.00 for insured auto accident cases until 2015. This means you’d be capping your damages at $7,500.00 if you sue in small claims court. It may be worth the cost of an attorney’s fee to avoid small claims court and the $7,500.00 cap.

  10. sh says:

    I’m thinking this is just too small for big boy court- the lawyer fees would eat everything. $7500 would be OK but I also understand in CA the defendant can appeal if it’s over $2500 from small claims.

    Don’t they have any obligation to negotiate with me? Wouldn’t that make them look bad to a judge in court? This is a rear end accident- they’ve accepted all responsibility – there’s no claim whatsoever against my insurance. I was rear ended at a sitting at a stop light.

    Oh.. and because of the defendant’s ability to appeal from small claims (which is what these insurance companies are doing these days so they can bring their lawyers)… I’m wondering- can an individual (me) file directly to court beyond small claims? I’m an MBA and really organized and OK with public speaking and debate. Is there any advantage to small claims if I’m going to get appealed anyway?

    • fl_litig8r says:

      Well, I took some time and read up on California small claims court rules due to your description of their procedures, which sounded ridiculous to me but turned out to be 100% accurate. To give you some perspective as to why I was surprised by California’s rules, in Florida attorneys are allowed in any small claims case, and an appeal of a small claims decision is reviewed as an appeal should be (a review looking for error by the trial court based on the record from the original trial) — not a complete retrial as is the case in California.

      But yes, you are correct — no lawyers are allowed in the original small claims hearing; only defendants can “appeal” (really, this is a retrial and not an appeal, but I’ll use the term appeal to avoid confusion); they can only appeal if the damages awarded exceed $2,500.00; and yes, for some reason attorneys are allowed at the new appeal trial even though they weren’t allowed at the original. There really doesn’t seem to be much incentive for an auto accident defendant to put much effort into the original trial if they get to use a lawyer at a new appeal trial, so I don’t see the logic behind this process.

      On to your questions. . .

      Technically, they have no legal obligation to negotiate with you. Their duty to pay you arises only after you get a judgment against their insured. Until then, they owe you nothing and don’t have to negotiate if they don’t want to.

      Realistically, they know that litigating the matter, especially in a case worth about $10,000.00 is not really cost effective. If they believe that you will actually sue them if they don’t settle, they probably will want to negotiate. Even if they don’t respond to your demand letter (because it wasn’t sent by a lawyer, so they may think you really won’t or can’t sue), if you sue them in small claims court they’ll probably want to negotiate then. I would imagine that in a case of admitted liability, they wouldn’t want to ultimately have to pay a lawyer when they can settle for $10,000.00 or less. So, while you’re concerned about them hiring a lawyer to appeal a small claims judgment, I doubt that it would get that far. A lawyer might be able to reduce your judgment, but probably not by enough in a case of admitted liability to justify his fees — at least not when your damages already max out at $7,500.00. It’s just not cost effective.

      I really wouldn’t recommend trying to file suit in anything other than small claims court. While you may be smart enough to learn the rules, it won’t be worth the effort required and you’ll still have no experience, which is more important than raw intelligence when it comes to trying a case (in a court that will hold you to all formalities). Plenty of excellent lawyers are scared to death to go to trial, and the longer it is since their last trial, the more scared they get because they keep forgetting more and more as time goes by, and there’s a lot you need to know to conduct a trial. I strongly suggest that you stay in small claims court if you’re going to sue on your own. The advantages I see are two-fold: (1) they may not be so quick to appeal, for the reasons I stated above and (2) the procedures tend to be far more relaxed in small claims court — it’s just a much easier environment when the judge is kind of walking you through the process. That won’t happen in a non-small claims court.

  11. LoriS says:

    Hello, learning many tips on this site since we’re going to be sending a demand letter shortly.

    Our vehicle was hit from behind (we were doing 40 and the other driver was doing 80 – admitted and in the police report); she hit the back then spun and hit the side of our car so we rolled once landing on the tires. My husband was driving; I was a passenger in the front and 13 year old in the back passenger side. The happened on a very busy freeway in California.

    We have loads of injuries, loss wages, PTSD, depression, and surgery for husband (spinal).

    My questions are:

    1) Do we send a separate demand letter for each one of us or one letter with one grand total?
    2) Are policy limits per person – meaning, for example, if they have $100,000 but we ask for $500,000 between the three of us, is it possible for a $300k offer/settlement or only $100k?
    3) Do we copy our own insurance company on the letter – putting them on notice they may need to pay out on the under-insured part of our own policy?
    4) The driver is not the policy holder – it’s her father’s insurance. If the insurance meets policy limits, do we sue the father or the daughter or both for the remaining amounts?

    Thanks for your time!!

    • fl_litig8r says:

      1. A single demand letter is fine. I would recommend having separate sections for each of your damages, e.g., “Wife’s Name’s Wage Loss, Husband’s Name’s Wage Loss, Wife’s Name’s Medical Expenses, Child’s Name’s Medical Expenses, etc. I would demand separate amounts for each claim. This would be important both for preserving your potential bad faith claims and for negotiating health insurance liens.

      2. Policy limits can either be split or combined single limit. If they are listed like “100/300″, then they are split and the first number is the per person limit (the second is the limit for all people combined). If they are expressed as a single number, like “300″, then they’re combined single limit, and that total just limits all damages from all plaintiffs combined, with no individual limit. So, under a split limit, an individual claim worth $150,000 could only recover $100,000, even if the two other claims are only worth $10,000 each. Under a combined single limit, the $150,000 claim could be paid in full as long as the other two claims are worth $150,000 or less combined (so they don’t exceed $300,000 total). There’s really not much point to demanding more than policy limits unless you know their insured has the ability to pay the excess amount within a reasonable time. Most of the time, this isn’t the case and demanding more than policy limits makes it easier for the insurer to say no (as there’s now no risk of a bad faith claim).

      3. I wouldn’t copy your insurer on your letter to the BI carrier. California law doesn’t require that you get permission from your UIM carrier to settle with the BI carrier, and only requires notice to your UIM insurer when you file a lawsuit against the underlying tortfeasor (not when you’re making a settlement demand). To learn basically all I know about California UM/UIM law, see my July 20, 2012 comment to Vicki after this article. While your UIM insurer has no duty to pay until after the BI carrier has paid its policy limits (another reason to make separate demands for each claimant), if you feel that one or more of your claims will exceed those limits, you could send a separate demand letter to your UIM carrier now which includes all the same information as you sent to the BI carrier, but demands the amount which exceeds the BI carrier’s limits (assuming your UIM limits exceed the BI limits). You could also choose to wait until after the BI claim is resolved, but sending your UIM demand(s) now could save time if you’re sure that you have one or more claims that will trigger this coverage.

      4. What you should do is hire a lawyer — not try to sue on your own. That being said, under California law, vehicle owners are only liable for up to $15,000 unless they were independently negligent when allowing the third party to drive their car (e.g., they knew the person was unfit to drive), so you couldn’t collect anything more from the owner without proving that he was negligent in allowing his daughter to drive. In theory you could sue the daughter, but the insurer isn’t going to settle unless you give both insureds a full release. They won’t pay you anything without such a release.

  12. SBF says:

    My case will be settled soon. The settlement letter states the defendants are free to sue the plaintif after the case is over. If I have to drop all lawsuits against the defendant, to accept the settlement offer, why should the defendant be allowed to sue me, the plaintiff? Can I cross this out, or ask that it be removed from the settlement letter? Is this wording normal from the Insurance Comapany? This is a personal injury lawsuit where the defendant has accepted. (A case of my injury due to gross neglect on the part of the homeowner.)

    • fl_litig8r says:

      The wording, as you describe it, is not normal for a personal injury release. While a standard release will contain “indemnify and hold harmless” language, which basically allows the insurer/defendant to sue the plaintiff if an unpaid (usually medical) lienholder sues them for repayment after the settlement, it isn’t normal for such a release to state that the defendants specifically reserve the right to sue the plaintiff for anything.

      While you could cross it out, I would suggest calling the adjuster and discussing it first. Not only would this make the revision process smoother (you could agree to any replacement language ahead of time), but it may also let you feel out whether the defendant is legitimately thinking about suing you for something. Don’t expect to just slip the revised (crossed out) release by them — they will notice. So, it’s better that you handle your revisions openly, which will save you time in getting this matter resolved. They may surprise you and just agree to the removal of the language.

  13. vanessa says:

    This may be miniscule but I slipped and fell in a local grocery store. Its one of the biggest grocers in the state of Texas. I didn’t go to a doctor because its mostly pulled muscles, soreness, bumps and bruises. I was out of work for a day and was off the next two days. I was sore for about a week and a half. I talked to the adjuster and she said the could offer me $400 out of courtesy for my lost work time. I tried to tell her that I had to put my life on hold to heal, I had a hard time taking care of my special needs child and she said to think about the offer and its only a courtesy since they have not done of full investigation into the claim to determine liability. I slipped on finger nail polish remover that was spilled in the middle of the aisle. $400 seems low to me. Your thoughts?

    • fl_litig8r says:

      Given your lack of medical treatment, I doubt that there would be many, if any, lawyers interested in taking your case. This means you have to get the best you can on your own. Slip and falls due to spills are not slam dunk cases, especially when the spilled substance was likely spilled by a customer and not by an employee or caused by defective equipment, like a cooler. It really boils down to how long the spill remained there, which often you have no way of knowing (unless there is surveillance video of the spill, which might be erased by now). You would have to prove that the spill was there for a sufficient amount of time that a store, through reasonable policies, should have detected it. As you might expect, the law doesn’t require that stores constantly monitor every aisle for spills. I’m sure the store will argue that it has some policy in place for periodically checking for spills at reasonable intervals, but for you to contest this on your own seems impractical.

      While this matter might have been worth pursuing had you suffered a serious injury that required medical care, I really think you’re in a position to just take what you can get. It wouldn’t hurt to ask for more (I doubt that they’d move more than $100-$200 from their initial offer, if at all), but the reality is that $400 is better than $0, which is likely what you’ll get with a case that no lawyer will touch. As long as you’re sure that your injury is fully healed, and not something serious, you should seriously consider their offer.

  14. Jenny says:

    I am 20 years (insured by my parents but do not have not UM insurance) and live in Florida which is a no fault state. I was in a pretty bad car accident recently where I was a passenger and the driver drove into a tree going 70 miles per hour. The car caught fire was a total loss. I lost several personal items and I endured permanent injuries.

    I have a C1 fracture, C5 and C7 herniated discs and straightened C spine. Because of the injuries locations there is really nothing they can do at this time just monitor the injuries, make sure the fracture heals without impeding on my spinal cord.

    The owner of the car (also 20 and insured by parents insurance $25,000 BI limits) asked another friend (also 20 and insured by parents $100,000.00 BI limits) to drive me home because she had been drinking. Can I request BI limits for both the owner of the car as well as the driver of the car?

    • fl_litig8r says:

      Yes (wow, that was an easy one). Both the owner and driver of the vehicle are liable for your injuries, so if they are two different people insured under two different policies, you can recover from the BI insurance of both policies.

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