If you’ve never dealt with insurance companies, you may be unaware of how they operate. When you’re in an accident and seeking financial recovery, insurance companies commonly make lowball settlement offers to try to close out your claim and save money for themselves.
If you receive a settlement offer from the insurance company and don't know whether they're lowballing you, a personal injury lawyer can help.
What Does It Mean for an Insurance Company to Lowball?
When an insurance company gives you a lowball settlement offer, it means they offer to pay you much less than your claim is worth.
If you can't wrap your mind around injuries and losses having a monetary value, your lawyer can explain it to you. Everything related to your accident, from your medical bills to emotional distress, has value. A personal injury attorney calculates your damages to determine how much your case is worth.
Insurance companies try to make it seem like they have your best interests at heart, but they do not. They have many self-serving goals, one of which is to pay out as little as possible for claims.
Why Do Insurance Companies Lowball?
Insurance is all about money. Insurance companies make money and intend to do everything possible to keep it.
Insurance Companies Try to Pay as Little as Possible
Insurance companies use several tactics to pay victims as little as possible for their injuries and other losses.
For example, the other party's insurance company may call you to request a statement. The communication may seem innocent, but they have ulterior motives. They will try to use your words against you to limit their liability and your payout.
Additionally, the insurance company may try to shift some or all of the blame to you or a third party.
When insurance companies turn to these and other tactics, you can rely on your personal injury attorney to help fight against them.
Insurance Companies Prey on Unrepresented Victims
Insurance companies often fare better when victims do not have a personal injury lawyer helping them with their claim.
When a victim handles their claim independently, the insurance company banks on the likelihood that the victim has little knowledge of the law related to their claim. In many cases, the insurance company can get away with paying much less than you deserve when you don't involve a personal injury lawyer.
The Insurance Company Hopes to Resolve Your Claim Quickly and Avoid a Lawsuit
The quicker the insurance company can resolve your claim, the better. Additionally, when a victim agrees to settle early, the insurance company can rest easy knowing the victim will not file a lawsuit for compensation.
Before filing a personal injury lawsuit, you'll try to collect compensation from the insurance company directly through settlement negotiations. You may need to sue when the insurance company insists on lowballing you, denies your claim, or refuses to settle altogether.
Additionally, the insurance company knows you have a limited amount of time to file your lawsuit if one is necessary.
Lawsuits can be costly and time-consuming for insurance companies. It’s a win for the insurance company when they can dodge the lawsuit bullet.
Many People Accept Lowball Offers
Believe it or not, it’s common for injured victims to accept lowball offers from insurance companies.
Usually, when a victim accepts the offer, it’s because:
- They want to settle quickly and get their check
- They don't know it's an unfair offer, as they don't see the value of their case
- They don’t know how to negotiate
- They don’t have a personal injury attorney
Knowing whether to accept an insurance company’s settlement offer can be confusing. This is one of the primary reasons why a personal injury attorney is critical to the success of your claim.
Signs the Insurance Company Is Giving You a Lowball Offer
Look for these signs if you don't know whether the insurance company is lowballing you.
You Receive a Settlement Offer Very Quickly After Your Accident
Insurance companies often send you a settlement offer as quickly as possible. Why? Because they realize you probably have no clue what your case is worth so early in the game.
Determining the actual value of your case takes time.
This is because calculating your damages frequently requires you to:
- Fully understand the severity of your injuries
- Determine how long it will take for you to recover from your injuries
- Know whether any of your injuries will have lasting effects
- Factor in additional losses, like lost wages, property damage, and emotional distress
If you receive a settlement offer too quickly after your accident, you probably don't know what your case is worth yet—and the insurance company knows this.
They Pressure You to Accept Their Offer
Once they send you the initial offer, the insurance company may pressure you to accept it quickly.
Insurance companies often pressure victims to accept the offer quickly and give them little time to contemplate it or seek legal counsel.
They Won't Explain Their Settlement Offer
The insurance company gets to its final figure by doing some math. So if you ask them to explain how they calculated the settlement offer and dodge your questions or refuse to answer, that's a red flag.
If an insurer cannot give you a straight answer regarding the settlement offer, they’re likely lowballing you.
What to Do if You Think the Insurance Company Is Lowballing You
If the insurance company provides you a settlement offer and you believe they’re lowballing you, first and foremost, do not accept the offer. Even if they pressure you, you don’t have to give them an answer right away.
If you haven’t already done so, consult a qualified personal injury lawyer as soon as possible. Your attorney can go over the details of your case and review the settlement offer to give you legal advice on how to proceed.
Don’t Let the Insurance Company Talk You Into Accepting a Lowball Settlement Offer—Speak to a Personal Injury Attorney
If you’re in an accident and receive a settlement offer from the other party’s insurance company, do not accept the offer without first speaking to a personal injury lawyer.
A personal injury attorney has the knowledge and experience needed to help ensure you get the compensation you deserve after an accident.
Your lawyer will do whatever is necessary to get you a fair financial recovery, whether it involves settlement negotiations or a trial. Count on a personal injury attorney to help you seek justice.
