In the days and weeks after a motor vehicle collision, you can find yourself in a precarious financial position. If you suffered injuries, you may not be able to work at the same time that you have to cover the cost of repairing your car or possibly replacing it if the damage was bad enough. On top of that, you also have medical expenses related to your injuries to worry about.
When you get a settlement offer from an insurance company promising a lump sum amount to cover your expenses, you might feel compelled to leap at the opportunity to alleviate your current financial strain. However, many times initial settlement offers are far lower than what someone actually needs to cover the costs of a crash. Before you accept that offer, evaluate your situation for one of the three red flags that indicate the settlement may not be enough.
The insurance company made the offer within days of your crash
It can be hard to know in the first few days after a crash exactly how the injuries you suffer could affect your life. Especially in cases with significant injuries such as spinal cord injuries or traumatic brain injuries, you will likely have no idea about the long-term cost immediately after the crash. When the insurance company makes a very fast settlement offer, they might hope that you accept it before you realize what costs you will actually incur.
The settlement amount only barely covers your current expenses
If you have $9,000 in medical bills and the insurance company offers you a $10,000 settlement, that may seem great at first. However, it will likely cost more than $1,000 to repair your vehicle, to say nothing of future medical expenses and the wages you missed out on during your recovery. The closer the settlement amount is to your current medical bills, the more likely it is to be inadequate.
The person making the offer tries to demand an immediate response
Someone working for the insurance company could pressure you in the hope of coercing you into accepting a settlement offer as soon as they present it to you. Once they have your acceptance of that settlement, the insurance company no longer has any financial obligations to you, even if your expenses greatly exceed the settlement offer.
Any time you receive an offer, you should have the right to carefully review it and seek legal advice prior to making a decision. If an insurance employee tries to force you into making a snap decision, it may be because they know this settlement won’t stand up to scrutiny.
If a settlement is too low, you have the right to reject it or counter it with a more reasonable figure. Knowing that the settlement is inadequate is the first step toward standing up for yourself after a crash.