There is no defined process for estimating the monetary compensation you may be entitled to following an injury. As a result, many injured people, or those whose property was destroyed by others, do not know how insurance settlements are calculated or how to get fair compensation.
Insurance companies do not share their processes for calculating a settlement value. However, they base their payout on documents you submit with your claim, and future accident-related expenses are often not factored in.
Learn how to calculate an insurance settlement to ensure you obtain fair compensation for injuries caused by others.
How Do I Determine the Value of a Settlement?
Personal injury law permits you to seek compensation from the person or entity responsible for your injuries, such as another motorist, a dog owner, or a landlord. To determine if the offer made by the party’s insurance is reasonable, you must first understand the factors that influence your settlement.
Medical Bills
For the liable party’s insurance to pay a settlement, you must demonstrate that you were harmed due to their negligent or reckless behavior. Injuries and treatment are considered damages; if the accident did not occur, you would not have medical bills.
Also, consider future treatments and long-term care expenses from your existing injuries, particularly if they are severe.
Lost Earnings
Your injuries could prevent you from working for an extended time. As a result, you may lose income and benefits from your employer, leaving you and your dependents in financial hardship. You will need to factor this into your claim.
Damaged Property
If the incident resulted in destroyed property, the insurance company might pay for its repair or replacement per the policy coverage.
Miscellaneous Costs
During recovery, you likely incurred other out-of-pocket expenses like transportation costs, hiring help for chores, or home modifications due to limited mobility because of the injuries.
Keep copies of all bills and supporting documentation, such as medical records, pay stubs, and service quotations. These prove your economic losses due to the accident, and the liable party’s insurance should cover them.
Pain and Suffering
Not all losses can be given an exact monetary value, especially if their impact is intangible and subjective. For example, someone’s negligence has caused you bodily pain, mental anguish, worry, inconvenience, and a decrease in your quality of life. So, how do you calculate the economic effect of the insurance settlement?
Pain and suffering are difficult to verify and measure; thus, an insurance company may not cover them. However, you can calculate pain and suffering damages by using a multiplier method. You will need to add up all actual damages and multiply them by a value between 1.5 and 5.
A lesser multiplier may leave you shortchanged, whereas a greater one may be excessive. Consult a lawyer to determine your insurance payment.
For a free legal consultation, call 317-636-7777
Do I Have To Accept the Initial Offer?
No, you do not. It is a common mistake for injured victims to accept the insurer’s initial offer, thinking they have no bargaining leverage. However, such an assumption will cost you.
The insurance company will often look for ways to devalue your case. They will find gaps and oversights to arrive at the lowest payout possible. And if you do not challenge their offer at the onset, you agree with their calculation and waive your legal right to pursue additional or a higher claim.
You can negotiate a fair offer with the insurer, especially if you have the evidence to back your claim. Keep in mind that your estimated figure can be a starting point for negotiations. Working with a legal expert can help you reach a fair settlement.
What Happens to My Insurance Settlement If I Was Partly at Fault?
Adjusters might blame you for the accident to lower or refuse your insurance compensation.
Indiana follows the modified comparative fault rule. Under IC 34-51-2-5, your degree of fault in the incident reduces the amount of damages paid. Even if you are somewhat to blame, you may be reimbursed, but only to the extent of the other party’s responsibility. For example, if you are 20% at fault, you are only entitled to $80,000 in compensatory damages out of a $100,000 settlement.
While contributory fault does not bar recovery, it only applies if your share is less than the other party’s; otherwise, you cannot pursue compensation.
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Do I Need Legal Support?
While you should now have more insight into how insurance settlements are calculated, you could still make costly mistakes if you attempt to figure it out independently.
Though you do not need an attorney, working with one who is well-versed in dealing with insurance companies might help you negotiate a better settlement than you could on your own. A lawyer could prove invaluable, especially if you are preoccupied with recovering from your injuries. The professionals at Sevenish Law Firm, P.C., can provide the legal support you need. Contact us for a free initial consultation today.
Call or text 317-636-7777 or complete a Free Case Evaluation form
