How to Settle a Personal Injury Case in Pre-Litigation
Why Every Lawyer Should Be Marketing For Personal Injury Cases: Part 5
This is part of five in a 5-part series entitled, Why Every Lawyer Should Be Marketing For Personal Injury Cases.
How To Settle a Personal Injury Case Pre-Litigation
Most soft tissue injury cases are pretty straightforward.
Your client gets hit by another driver.
Indications are that the other driver is at fault.
Your client treats, usually with a chiropractor.
Defense insurance company accepts liability.
Your client finishes treating.
You prepare a demand letter and send that demand letter to the defendant insurance company.
The case is negotiated and settled.
There are important nuances in each of these steps that are very important to analyze. Let’s take a deeper dive into each of these steps so that you can best assess the value of the case and maximize the recovery of the case.
Importance Of Early And Consistent Treatment
The favorite insurance defense is that your client is suffering not because of the collision, but because of some pre-existing condition. If the case were to make it to trial, the defense expert would put up an MRI of your client’s spine and show the degenerative changes in the spine and say, “Look, this is what happens to the spine over time. It’s a coincidence that the onset of pain was just after the collision.”
It is vital to attack this defense immediately after the crash. You must get the treating and document the injuries as close to the crash as possible. The client should go to urgent care (or emergency room depending on severity of the injuries) to document the injuries. Then the client should follow up with treatment as soon as possible after the initial crash. This would be with either chiropractic care or physical therapy. Most chiropractors are well versed in helping patients heal after a crash.
You must teach the client the importance of not missing doctor’s appointments and treating regularly and following recommendations. The defense will look at any gaps in treatment to blame the pre-existing condition or to depress the value of the case claiming that the client isn’t hurt that badly otherwise she would have treated more regularly.
Initial Documents
You need to get the police report from the incident. Typically, in California, it takes ten calendar days to get a police report from a crash. The sooner you can get this the better. By the time you get the police report, your client should be treating already. Confirm with the police report that your client’s story to you is consistent with the police report and there are no conflicting statements. If something doesn’t line up, the sooner you can talk to the client about it and make a determination as to viability of the case the better.
You need to send out a letter of representation to the insurance company for the other driver and for your client’s insurance company. This will prevent the other driver’s insurance company from reaching out to your client and will establish a line of communication for later settlement discussions.
Know that the defense insurance company will be “setting reserves” on the case at some point early on. They will be trying to set aside a certain amount of money to pay on the case. The earlier and higher you can get those reserves set the better. It becomes difficult to get the insurance company to get money above the initial reserves because of the bureaucracy involved with insurance companies.
You want to get a HIPPA release from your client so you can get any and all medical records for your client. This includes any pre-accident treatment for any body part or injury you will be claiming in this case. The defense will use any pre-accident injury to drag down case value. Without ALL treatment records related to the accident, you won’t be able to settle that case. You also want to get records from your client’s health insurance company to see if they have paid for any treatment that the health insurance company will want reimbursement for. Also, ensure that your client keeps a journal where he or she tracks the severity of his or her injury and things he or she has missed out on because of the injury. This information will be used later in the demand
Obtaining The Insurance Coverage For The Other Driver
The minimum bodily injury policy a driver in California must carry is $15,000/$30,000. These numbers represent that the most the insurance policy will pay is $15,000 per person or $30,000 per incident. If your client’s damages are minimal, these numbers should be sufficient. But, if your client requires injections of any kind or any treatment beyond an MRI and chiropractic, these numbers will be insufficient, and you MUST determine what the limits are.
Also, always look to your own client’s underinsured/uninsured policy information. If the other driver is uninsured or has insufficient coverage, you can apply to your client’s policy to cover your client’s damages over and above the defendant driver’s coverage.
You should ask the insurance adjuster for the defendant driver for the insurance policy limits. If the defense won’t provide the limits, you are left with two options: hire an insurance investigation company for approximately $300, or file the case and obtain the limits in discovery.
The Demand
You need to maintain regular contact with your client to ensure he or she is treating regularly. Once the treatment is concluded and your client is discharged, you are ready to send your demand.
Valuing a case can be difficult and there are a lot of variables that go into determine what your client’s case is worth. Keep in mind that insurance companies have a duty to protect their insureds from a verdict or judgment in excess of the policy limits. This is the best leverage you have to get the case settled. Adjusters like hard damages like medical bills and lost income because it allows them to justify any amount they pay out.
Resolving Liens
The best time to resolve liens is just before the case is headed towards settlement. Your leverage with the lien holders is that your client wants a certain amount in his or her pocket, and the insurance for the defense is tapped out. Explain that now is the best time to get the case resolved otherwise you are all headed for litigation and a substantial period of time before anyone recovers anything.
Final Resolution
When the case is finally settled and you are ready to disburse funds, be sure to prepare a final valuation wherein your client can see where every dollar is going including your fee, liens and costs. Explain in writing in the document that you have resolved all known liens and the client is responsible for anything and everything else. Have the client execute the final valuation before disbursement to protect yourself down the line from any potential claims (including liens you do not know about). Be sure to ask your very happy client to go on google or yelp or anywhere else to give you a great review.
Handling a personal injury case pre-litigation has its challenges, but it is a great way to increase the cashflow to your business and gain more happy clients.
Other blog posts in this series:
Part One: How Any Lawyer in California Can Add a Passive Stream of Income to Their Existing Law Firm
Part Two: How to Leverage Your Existing Contact List to Increase Your Income
Part Three: Frequently Asked Questions About Personal Injury Cases (For Non-PI Lawyers)
Part Four: How to Ensure You Receive Your Referral Fee After You Send a Case to Another Law Firm
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