Does Simply Having A Personal Injury Attorney Involved Tend To Make Insurance Companies Evaluate My Case Or Claim Differently Than If I Were Going It Alone?
Having a lawyer on the case (as opposed to doing it alone) certainly affects the way insurance companies evaluate your case. I’ve even seen it go as far as insurance companies switching the adjuster on you if they realize you have an attorney. In some of these cases, you will be speaking to one adjuster in the immediate aftermath of your accident, but the second an attorney gets on file, they shift you into a different department with a completely different adjuster. The reason behind this is that they know attorneys are not going to accept a bad offer on a good case, whereas a layperson might. These insurance companies spend a lot of money on training and psychological warfare and understanding how to get people to accept less than what their case is worth. Again, at the end of the day, it’s a business, and they don’t become multi-billion-dollar companies by paying fairly on their claims.
In fact, at the end of the day, in order to make a profit, they have to receive more in premiums than they pay out in settlements. Therefore, put plainly, insurance companies see a person without legal representation as an opportunity. They see someone they think they can more easily convince to take an unfair settlement. Just knowing that there’s an attorney involved changes the equation for them. They know that attorneys know better, and that they’ll know what similar cases in the community settle for, whereas the average person has no clue at all. An insurance company may offer a person without an attorney $1,000 on a surgical herniated case that’s worth maybe a million dollars. They will assume, often correctly, that the person doesn’t even know how much their claim is worth, especially if they’re young. You might have an 18-year-old who now has a herniated disc that’s only going to get worse and continue to be painful for the next 60 years. That 18-year-old may accept $5,000 as a total settlement for all of those future medical bills and all of that pain and suffering, because they’re broke and young and $5,000 seems like a lot. But in 20 years, when they can’t get out of bed, they will wish they hadn’t taken it. An attorney understands that, which allows them to fight for the best settlement possible for their clients.
Does The Threat Of Going To Trial Enhance The Likelihood Of Getting A Fair Settlement From Insurance Companies, Without Actually Having To Go That Far?
I get this question a lot. People ask me, “Can’t we just threaten to sue them?”
My experience has been that if you don’t do what you actually threaten or say you’re going to do, you will lose bargaining power. Put simply, that’s just not a good look. You never want to threaten litigation and not follow through with it. They’ll know that you did it for the rest of the case you’re working on and for the rest of the cases that involve them. As I said before, they keep track of these things. If you threaten to sue in every letter and at every step of the negotiation—or even just a few times—and you never follow through, you will likely end up taking less than what the case is worth, and they’re going to know you’re all talk and no walk.
Instead of issuing false threats to sue, the way to actually increase the value of a case is to actually go to trial when you say you will. More specifically, it’s coming up with a fair settlement offer in your mind and doing the focus groups and doing the homework and really evaluating it properly. Then it’s demanding that number from the insurance company, and if they do not meet it after sufficient attempts to convince them it’s the best move for them, it’s taking the case to trial. That’s really how you do it.
Of course, though you should always prepare as though the case is going to go to trial, cases can settle at any given point. They often settle before litigation. In some cases, cases settle at the last possible moment before litigation, and even during litigation itself. I’ve had a lot of cases settle on the courthouse desk, or after opening statements, or when the jury is deliberating. Cases can settle all the way up until that point.
Based on my experiences of these cases, I have a motto. You always prepare for the worst, but hope for the best. What that means is from the very moment we get a file; we prepare as though it’s definitely going to go to a jury trial. We think of our opening and closing statements months or years before we even get there. We’re preparing for the worst, which is the jury trial, but hoping for the best. My experience has been that if you do that, if you do the work and the preparation, a fair settlement will be the natural product of the process.
Am I Guaranteed A Larger Settlement If My Personal Injury Case Goes To Trial And I Win? Could I Possibly Get Less Than What The Original Settlement Amount Was Offered?
Unfortunately, you’re never guaranteed that you’ll get a larger settlement if the case goes to trial, even if you win. The reason for this is because once you go into litigation or trial, the costs increase exponentially—both the case costs and the attorney’s fees. This is because there is substantially more work involved in litigating a case than in negotiating a settlement pre-suit. We do our best to make sure that doesn’t happen, and there is sometimes a very delicate balance that we have to strike. There is always the possibility that you may get less net recovery for the client, but the verdict or the settlement may be larger. For example, if you settle a case for $100,000 at trial and you’ve got $50,000 in costs, it’s going to put less money in your client’s pocket than if you would have settled the case maybe for $70,000 and you had no real costs. This is what we mean when we speak about the delicate balance.
Unfortunately, the fact is that litigation costs are higher now than they have ever been, and they only keep increasing. The cost of expert witnesses, for instance, is staggering. I’ve got some expert witnesses that charge between $750 to $1,200 an hour for a deposition. With the average deposition time, you’re looking at 2, 3, 4 hours. The deposition transcript reproduction fees are also very expensive now.
In addition, a whole field of new costs seems to be arising since the beginning of the COVID pandemic and the introduction of full trials over Zoom. Attorneys are focusing on expert services and consultants that can produce visual effects, such as graphics and animation. I anticipate that Zoom trials will become almost like television productions, with the need for similar production experts and companies.
We ourselves have hired graphics and animation people, and will probably continue doing so whether or not trials are happening over Zoom. The reality is that it is effective. Different people learn and comprehend information differently. For instance, some people are auditory learners, and some people are visual learners. Animations and infographics can communicate information to visual learners far better than spoken words from an attorney or an expert witness or even a judge might be able to. Our job is to try to figure out the best way to communicate most effectively to the most people. These days, that’s often through graphics or animation or trial production companies. They can be quite expensive, but they’re very powerful and persuasive.
So, in summation, the bottom-line is that you’re never guaranteed to get more money through trial than through settlement. However, I can tell you that at my firm, we spend a lot of time and effort considering the right thing to do for our clients. We look at the anticipated total costs in every single case where trial seems imminent, almost like forming a budget. From there, we can figure out the settlement amount that we’d need to win in order to get our client substantially more than what they were offered in a pre-suit. We look over those numbers carefully in order to discern what is realistic and in the client’s best interest, and what isn’t, in any given case.
It should be noted that we don’t always know exactly how things will play out. For instance, there have been times where I’ve recommended that clients take a lesser offer pre-trial, because it seemed like that would put the most money in their pocket, but we went forward with trial and the client ended up with more net recovery than we had anticipated.
At the end of the day, my clients really only care about how much they’re walking away with. They don’t particularly care if you win a million-dollar verdict if the trial racked up $990,000 in fees and costs and they only get to take home $100,000.
As such, we find it crucial to sit down with our clients before we file any lawsuit on their behalf and let them know exactly what the situation is. We tell them what we think the case is truly worth, and what we anticipate it’s going to cost to get us there (in terms of fees and costs). We make sure to be clear and honest about what the client’s take-home is likely to be, and whether that would be substantially higher than accepting a pre-trial settlement. I also make sure to be very realistic with them about what trial entails. For lack of a better phrase, trial is a pain in the butt. No one really likes going through it, as it is generally not an enjoyable experience for clients who are having their pain and trauma picked apart. However, for a substantial enough amount of money, many clients feel that it is worth it.
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