Three Things To Consider Before Rejecting A "Low" Settlement Offer

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A common piece of advice concerning personal injury claims is not to accept a low offer. However, you shouldn't automatically apply this advice to all injury cases. Instead, evaluate each claim individually before making a decision. In particular, you should consider these four things before rejecting a "low" offer:

State Rules on Settlement Caps

Some states have limits on how much compensation you can receive for specific damages. For example, many states have limits on non-economic damages, such as pain and suffering, and punitive damages. Therefore, it may not make much sense to pursue more money for punitive or non-economic damages if you have already been offered the maximum amounts possible, or something close to it. In short, consult your state's laws on compensation limitations before rejecting what you believe to be a low offer.

Insurance Availability

Another thing you should consider is whether or not the defendant is insured. Many personal injury cases are settled with insurance money. For example, when you file a defective product claim against a pharmaceutical company, it's the insurer that pays the compensation if you succeed.

What about if the person you are suing isn't insured? In that case, he or she has to pay your compensation out of his or her pockets. As you can imagine, your desired settlement may be too much for the individual to pay. Therefore, if the person responsible for your injury isn't insured, it's best to determine whether he or she has the resources to compensate you before you go to court.

The Defendant's Policy Limits

Finally, you need to consider how much money is available to pay your compensation. As described above, most injury claims are settled by defendants' respective insurance companies. Therefore, if your defendant is insured, you need to consider his or her policy limit because you aren't likely to get more than that, especially if he or she is penniless.

Consider an example of a broke defendant who is insured up to a $100,000 limit. If you are looking for a $250,000 settlement, and the defendant cannot top up the difference, then it is sensible to accept the limit (if it's offered) even if it is low.

As you can see, this isn't an easy decision to make. You should take your emotions out of the equation and consider the facts at hand. Your attorney will help you to analyze the offer and your case's strength, and decide on the way forward. Only reject a low offer if you have high chances of winning, and actually getting your hands on a larger amount. Contact a law firm, such as Jacobs & Barney LLC, for more information.