Should I Take the First Offer of a Car Accident Settlement?

Although the total number of car accidents in Canada has decreased in recent years, unfortunately, these accidents are still all too common. Car crashes can lead to injuries that require prolonged medical treatment—including procedures and physical therapy. They can also lead to other serious complications. ​

When victims of car accidents suffer injuries, they may recover various types of compensation through settlement or litigation. However, many accident victims find that despite promising advertisements from car insurance companies, these companies are not generous when issuing settlement compensation.

Most insurance companies will do everything to limit an accident victim’s settlement payout. At other times, the insurance company might deny fault for the accident altogether and may not make a settlement offer. ​

When insurance companies make initial offers to settle car accidents in Canada cases, these offers are usually far less than injured victims are entitled to. Therefore, never accept the first settlement offer that an insurance company adjuster puts on the table—certainly not without discussing it with a car accident lawyer.​

Given the inherent difficulties in dealing with insurance companies and their adjusters, you need a knowledgeable auto accident lawyer on your side advocating for you throughout your case.

First of all, an experienced car accident lawyer can represent you during all settlement negotiations and will work to get you the total and fair compensation you deserve for your injuries. Moreover, your lawyer can recommend whether or not you should accept a settlement offer or take your case to trial or binding arbitration.​

Injuries and Other Consequences of Car Accidents​

Victims of car accidents can suffer highly severe injuries that may leave them permanently disabled. Many accident victims will experience symptoms well into the future and sometimes for the remainder of their lives. A car accident claim or lawsuit can recover compensation for pain and suffering. ​

What Kind of Injuries are Suffered in Car Accidents?

The injuries that a car accident victim will suffer in their accident depend on how the accident occurred, the way the accident victim’s body moved in the car, and whether the accident victim struck something in a vehicle.

For example, the force of an impact from another vehicle might cause a part of the accident victim’s body to hit the console, headrest, steering wheel, or door frame, resulting in severe injuries. Potential injuries from car accidents can include broken bones, soft tissue injuries, cuts and scrapes, traumatic head injuries, and spinal cord damage.​

What Treatments are Available from Car Accidents?

Whenever a car accident victim experiences one or more of these injuries, they might need to seek several types of medical treatment. First of all, the accident victim may need to follow up at an urgent care center or local hospital emergency room so that a healthcare provider can ascertain the full extent of their injuries. The provider can also render emergency medical assistance if needed and make recommendations for follow-up treatment.​

When the insurance company receives and reviews the accident victim’s medical records and other documents, they are also supposed to consider the pain, suffering, and inconvenience that the accident victim had to endure while seeking treatment for their injuries. The insurance company should also consider the time that the accident victim missed from work after the accident due to their various injuries

What About Permanent Injuries?

If the car accident victim suffered a permanent injury, the insurance company should consider the potential impacts, including the pain and other symptoms that the accident victim might experience in the future.​

A knowledgeable car accident lawyer in your area can highlight the strengths of your car accident case while downplaying any weaknesses. Your lawyer can also negotiate with the insurance company adjuster and encourage them to consider the consequences of your car accident when making a settlement offer in your case.​

What Are Some Prerequisites to Settlement Negotiations?​

In a personal injury car accident claim, you must take specific steps before an insurance company makes an initial settlement offer.

First of all, in most instances, the accident victim will need to complete their medical treatment. Once that happens, the accident victim’s lawyer can prepare a settlement demand package. The settlement demand package will first include a demand letter that makes a monetary demand within the limits of the available insurance policy.

In cases where an accident victim suffered an extremely severe injury, the accident victim’s lawyer might demand the full amount of the insurance policy to settle the claim.

Along with a demand letter, a settlement demand package will include other important documents. Those documents may consist of copies of lost wage statements from the accident victim’s employer, photographs of the accident victim’s injuries, eyewitness statements, police reports, and pictures of the vehicular property damage sustained in the accident.​

Once the insurance company adjuster reviews these documents, they will decide whether to accept liability for the case. If the insurance company accepts fault for the collision, it is at that point that the adjuster might make an initial offer to resolve the case through settlement. The adjuster’s initial settlement offer will typically be meagre. Therefore, you should be wary about accepting such an offer.​

Why Are Initial Offers From Insurance Companies Low?​

Insurance companies are not in the business of helping accident victims. Instead, they are in the business to make (and keep) money.

The more an insurance company pays an accident victim as part of a car accident claim, the more money it loses. Therefore, the insurance company and its adjusters will do everything to keep their money in-house.

They try to accomplish this by making low initial settlement offers and by settling early and directly with accident victims before they retain a personal injury lawyer. For example, the insurance company might only offer to pay the accident victim their lost wages and a minimal amount in pain and suffering. At other times, the insurance company’s initial settlement offer might not include any compensation for pain and suffering.​ An early settlement offer to someone under significant financial stress following an accident may appear very tempting.

One of the reasons why insurance companies offer so little money at the onset is to see if the accident victim is in a hurry to settle their car accident claim. Some accident victims, for one reason or another, do not want to file lawsuits or litigate their cases in court. Therefore, the insurance company hopes they will accept anything to resolve the case and make it go away.

However, there is almost always additional settlement money available—although it will likely take some negotiations between the adjuster and the accident victim’s lawyer to get to that increased number.​

In addition, you should be aware that simply filing a lawsuit in a car accident claim does not necessarily mean that the case will go to trial. The vast majority of car accident cases resolve well before the trial date.

Nevertheless, filing a lawsuit in the court system sends a strong signal to the insurance company adjuster that the accident victim takes the case seriously and will not accept a settlement for far below the actual value of their case.

An accident victim’s lawyer can help you decide whether you should accept a particular settlement offer or litigate your case by filing a lawsuit in the court system.​

How Do Settlement Negotiations Work?​

Settlement negotiations between an accident victim’s lawyer and the insurance company involve demands and offers. An accident victim’s lawyer makes the initial demand when they send an official settlement demand letter to the adjuster handling the case.

The adjuster will then respond with an initial offer. At that point, the accident victim’s lawyer may likely reduce their demand slightly to see how far the insurance company adjuster will increase their initial offer.

If the insurance company adjuster increases their offer, then the accident victim’s lawyer might decrease their demand again. This process continues until the parties either reach an impasse or decide to settle the case.​

An experienced car accident lawyer can help you in settlement negotiations. If you do not have a lawyer negotiating for you, there is a good chance the insurance company will try and take advantage of both you and your case. Remember that insurance companies not only have an interest in their bottomline, they also have skill, knowledge and experience that you don’t possess. 

They may not offer favourable compensation to resolve your claim through the settlement process. An experienced lawyer, on the other hand, will know how best to negotiate your car accident claim and will work to get you the maximum amount of compensation in your case.

If you decide to file a car accident lawsuit in court, your lawyer can litigate the case for you to maximize your damages. ​

Factors That Determine a Final Car Accident Settlement​

When settling a personal injury car accident claim, no two accident cases are precisely the same. Many car accident settlement values are very different.

Factors that will determine the final value of a car accident settlement include the type and extent of the accident victim’s injuries, the medical treatment that the accident victim underwent (including medical procedures, hospital stays, and physical therapy), and the inconvenience of that medical treatment.​

As part of a car accident claim, the accident victim can pursue several types of monetary compensation and damages. To be eligible for these damages, the accident victim must first satisfy the legal elements of their case. ​

First of all, they must demonstrate that another driver was negligent under the circumstances. Negligence takes many forms, but it usually means that another driver behaved unreasonably. For example, the driver might have violated a traffic law or regulation, such as by running a red light.

Alternatively, the driver might have operated their vehicle while intoxicated or engaged in distracted or careless motor vehicle operation. In addition, the accident victim must demonstrate that this negligence caused the collision. Finally, the accident victim must show they suffered various damages and that those damages directly resulted from the car accident.​

Victims of car accidents can pursue compensation (through settlement, trial verdict, mediation or arbitration award) for their lost wages, loss of earning capacity, inconvenience, mental distress, pain and suffering, loss of quality of life, and loss of the ability to use a body part. Accident items can pursue a loss of use claim, for example, if they suffered a paralysis injury or other permanent damage. A car accident lawyer will work to maximize the compensation you recover for all of your injuries stemming from the car accident. ​

Settling and litigating a car accident claim is often an uphill battle—and the at-fault driver’s insurance company (or any insurance company, for that matter) will not do you any favours. When it comes to your car accident claim, you want a lawyer on your side who is a skilled negotiator and who will aggressively fight for your right to recover the damages you deserve. ​

An experienced car accident lawyer can file a personal injury claim on your behalf and field settlement offers—including the initial offer from the insurance company. Your lawyer can then negotiate a favorable settlement number that makes you whole again and fairly compensates you for your injuries and other damages.

If the insurance company won’t provide you with the compensation you need, your car accident lawyer can file a lawsuit in court and, if necessary, resolve your case at a civil trial or mediation or arbitration proceeding.​ 

Do not wait any longer to begin protecting your rights – seek legal help right away. The process begins with a free consultation, and there is no obligation to hire the injury lawyer following this meeting. The lawyer will evaluate whether you have a case and advise you of your rights and how they can help. You can ask any questions you have about the process or the lawyer’s services, and then you can decide whether to move forward.


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