How much does a lawyer cost for a car accident? After a car accident, you face an uncertain future. You may have injuries that prevent you from working, caring for your family, and meeting your personal needs. Your injuries may require medical treatment, physical therapy, and medication. And you might require help driving, shopping, caring for children, and even showering and dressing.
But all of this help costs money. Without the physical ability to work, you will not be able to get the help you need. Even if your family helps out, they must still give up their time and opportunity to work so they can take care of you.
If your injuries resulted from someone else’s actions, you might have the right to injury compensation. This money can help you pay for medical treatment and living expenses until you can return to work.
To pursue an injury claim, you need a car accident lawyer. This attorney will manage your claim so you can focus on your health. The lawyer will provide the knowledge and experience in dealing with insurance companies to get a fair settlement or damage award based on your injuries.
How Lawyers Charge for Legal Services
Private practitioners charge for legal services performed for clients. Legal fees usually take three forms:
Flat Fees
Lawyers quote flat fees as a fixed sum of money for a defined project. Lawyers use flat fees when the project involves a predictable amount of work. A flat fee compensates the lawyer for the amount of work they perform.
A lawyer might charge a flat fee to prepare and file the paperwork to form a corporation. This project requires a predictable amount of work and has a defined ending point. Once the lawyer forms the corporation, any further work will require the payment of additional fees.
Lawyers rarely charge a flat fee for a car accident claim.
Hourly Fees
An hourly fee gets quoted as a specific amount per hour. Lawyers typically charge these fees for open-ended projects that require an unpredictable amount of work. Hourly fees compensate lawyers for the time they spend working.
For example, a commercial lawyer might use an hourly fee to negotiate and draft a contract for a business client. The lawyer and client have no idea whether the project will take one hour or fifty hours. As a result, the lawyer tracks the time spent on the project and bills the client for the accrued fees.
Some lawyers charge an hourly fee for car accident cases. But this is rare because many accident victims do not have any spare money to spend on lawyers.
Contingency Fees
Lawyers quote contingency fees as a percentage of the compensation the client recovers in the case. Contingency fee lawyers often work for clients who have valuable cases but no money to spend on legal fees. A contingency fee compensates a lawyer for the outcome obtained for the client. Bigger outcomes mean greater fees.
Not every lawyer can charge a contingency fee. In New York, criminal defense lawyers and divorce lawyers cannot charge a contingency fee. But most injury lawyers charge a contingency fee to resolve claims on behalf of accident victims.
How Contingency Fees Work
Most importantly, you need to get prompt medical attention for your injuries, no matter how minor, and keep copies of all your medical records, bills, body shop estimates, and receipts for related out-of-pocket expenses.
Benefits of Contingency Fees for Clients
Most injury lawyers charge a contingency fee because of the financial situations most of their clients face. After an accident, you need medical treatment to return to work. But you need to work to pay for your medical treatment.
Even the best health insurance policy will have a copay or deductible you must pay. Without income, you will need to dig into your savings. And your savings will only go so far when you need to pay medical bills and living expenses.
Since nearly half of Americans lack the savings to pay for a $400 emergency expense, that creates a difficult situation. As medical costs and living expenses rise, a disabling injury might put you in a position where you must choose between a physical therapy session and food.
Some additional benefits of contingency fees for clients include:
High-Quality Legal Representation
Insurance companies have access to large law firms of insurance defense attorneys. These insurance lawyers fight against claims on behalf of insurers to prevent accident victims from recovering any injury compensation.
Accident victims also deserve legal representation. But since most accident victims lack resources, they might abandon their cases before they even start because they cannot afford a lawyer.
Contingency fees allow excellent lawyers to work for financially-strapped accident victims and still get paid. They do this by collecting their fees as a portion of the settlement or damage award at the end of the case.
No Upfront Fees
Since a car accident lawyer does not get paid until the end of the case, you do not need to pay any upfront fees. This means the lawyer can start working on your case immediately after you sign the paperwork needed to engage the lawyer and authorize the law firm to act on your behalf.
No Fees if You Lose
Your legal fee depends on the outcome of your case. If you lose your case, your car accident attorney receives no fee. When a contingency fee lawyer fails to recover any compensation for you, the lawyer earns nothing. As far as legal fees go, you have no financial downside when you hire a contingency fee lawyer.
Confidence in Your Case
An injury lawyer will only offer to represent you on a contingency fee if they have confidence in your case. Lawyers do not want to spend time on cases they might lose. If they lose, they do a lot of unpaid work.
As a result, injury lawyers often select only those cases likely to succeed. When a lawyer offers to represent you in your car accident case, they cannot guarantee that you will win or settle your case. But they use their experience to quickly evaluate your case and determine whether they believe they can get you compensation.
Aligned Interests
Contingency fees ensure that your interests align with your lawyer’s interests. Lawyers have an ethical duty to fight for the best possible outcome. But a contingency fee also gives them an economic incentive to maximize your compensation.
You cannot say the same about lawyers paid an hourly fee. In those cases, the lawyer has an economic incentive to keep the case going even when it might be in the client’s best interests to drop or settle the case.
What a Contingency Fee Covers
A contingency fee typically covers all the work the lawyer and their legal staff perform.
Some tasks your car accident attorney will perform under a contingency fee agreement include:
- Meetings, phone calls, emails, and other communications with your lawyer
- Acquiring medical records from your doctors, therapists, and other healthcare providers
- Collecting evidence from your car crash, such as accident reports
- Preparing and filing an insurance claim
- Responding to claim denials and reductions with documents and legal arguments
- Negotiating with the insurer to settle your case
- Drafting and filing a lawsuit if your case does not settle
- Interviewing witnesses and requesting discovery from the at-fault driver
- Filing motions to determine what will get used at trial
- Presenting your case to a jury
At the end of the case, the insurer will pay your car accident lawyer, and the money gets deposited into the lawyer’s client trust account. The lawyer will prepare a billing statement with the total amount recovered and the contingency fee earned, deduct the legal fee, and send your compensation to you.
What a Contingency Fee Might Not Cover
Contingency fees do not cover every aspect of a case. Most contingency fee agreements exclude anything that happens after a trial. Thus, if you lose your case, your contingency fee usually does not include the work to file an appeal.
Your legal fee will also exclude case expenses. These expenses were incurred on your behalf during the case. Instead of having you pay each one as they arose, the lawyer paid them. But at the end of the case, you need to reimburse the lawyer for the money spent on your case.
Some examples of case costs include:
- Medical records charges
- Court filing fees
- Stenographer fees
- Expert witness fees
Before your car accident attorney sends your compensation to you, they will deduct any case expenses incurred.
Questions to Ask When Consulting a Contingency Fee Lawyer
Most injury lawyers offer a free consultation to new clients. You should use this consultation to understand exactly how much the car accident attorney charges for legal services.
Some questions to ask when consulting an injury lawyer include:
What Percentage Will You Charge?
Different lawyers charge different percentages. In certain courts, New York appellate courts set guidelines for a reasonable contingency fee. Under these guidelines, lawyers can use one of two schedules to set a presumptively reasonable fee. Lawyers can deviate from these schedules, but they need to give reasons justifying the fee.
A lawyer can charge more based on:
- Experience
- Reputation
- The difficulty of the case
A lawyer can also charge a tiered contingency fee. This fee structure can continue into many tiers, much like tax brackets.
This structure is extraordinarily complicated, so many lawyers stick with a legal fee that is a straight percentage of the total amount recovered.
How Will I Approve Case Expenses?
Lawyers will often allow you to review and approve case expenses before you incur them. You should make sure you understand this process so you can use it during your case to minimize any surprise charges when it ends.
Will I Need to Pay Case Expenses if We Lose?
Lawyers vary on whether they charge case expenses if you lose. If a lawyer expects reimbursement for case expenses after a loss, you will need to dig into your savings to repay the lawyer. These costs could amount to hundreds or even thousands of dollars out of your pocket.
Do You Calculate the Legal Fee Before or After Deducting Case Expenses?
The order the lawyer calculates the fees will make a difference in how much you receive. If the lawyer deducts case costs first, you and the lawyer share the case costs. If the lawyer deducts their fee first, case costs get taken entirely from your share.
The difference in the amount you receive may or may not be significant, depending on the amount of the fees incurred.
Hiring a Car Accident Lawyer on a Contingency Fee
When you hire a car accident lawyer, the rules of professional conduct require the lawyer to provide a written explanation of the fees and costs the lawyer will charge you. Many lawyers satisfy this requirement by having clients sign a contingency fee agreement with a written explanation included.
Before you hire a lawyer, review this agreement carefully. If your agreement does not match up with your discussions with the lawyer, make sure to clarify the inconsistency. And if there are any terms you do not understand, discuss them with the lawyer.
Contingency fees help accident victims hire legal representation for a fair cost. Schedule a free consultation with an personal injury lawyer to learn more about how much a lawyer costs for a car accident.
