A Guide to Insurance Companies and Property Damage Claims
Hopefully a guide on how to deal with insurance companies and property damage claims is all the information you would...
by Donaldson & Weston
In many ways, settlement negotiations in a car accident claim resemble settlement negotiations in any other personal injury case. An accident victim and the defendant or insurer bargain over the value of the victim's costs and losses. They exchange offers and counteroffers until they reach an amount that is acceptable to both sides or until one party decides to proceed to litigation.
That said, there are certain aspects of car accident claims that are distinctive or may seem less intuitive to someone unfamiliar with the process. The best way to protect your rights is to schedule a free consultation with a car accident lawyer. A seasoned attorney can review the facts of your case, answer your questions, and provide sound legal guidance.
Understanding the Insurer’s Perspective
Whether you are pursuing a claim against your insurer or the other driver's insurer, you should be aware that the insurer stands in a hostile position to you. Even if the claim is under your policy and the adjuster seems friendly, i.e., an uninsured or under-insured motorist claim. Insurers are profit-driven companies that have incentives to deny or minimize claims to the extent possible.
As a result, you should make sure to collect as much evidence as possible regarding the accident and your injuries. An insurer may initially deny your claim or offer a low ball settlement if it does not receive enough information about the accident. You also should be wary of confiding in an adjuster. While the adjuster may seem sympathetic, they are looking for ways to deny or minimize a claim. If you suspect that you may have been partly at fault for an accident, you should not discuss this possibility with the adjuster. Instead, you should share your concerns with an attorney.
An insurer may threaten to go to trial if you reject its initial counteroffer. However, insurers generally prefer to settle claims due to the unpredictability and cost of litigation. You may not want to take this type of threat at face value early in the process. However, litigation can become a real possibility if settlement negotiations stall over time.
Types of Damages in Property Damage Claims
Perhaps you were involved in a crash in which nobody was hurt, but you sustained significant property damage. Insurance can cover several forms of property damage, including repairs to your vehicle, and reimbursement for a rental car. You should carefully document each type of cost or loss, even if it seems minor or if it seems obvious. The insurer will base its offer on the information that you provide. If you fail to include a specific type of expense, the insurer will have the right to refuse to cover it.
Types of Damages in Injury Claims
Car accident claims involving injuries can be much more complicated and hard-fought since far more significant amounts of money can be at stake. While you may be able to handle negotiations over a property damage claim, you should consider hiring a lawyer for settlement negotiations in a suit involving injuries. Some general damages you may be able to recover are medical bills, costs of future treatment, lost income or earning capacity, and pain and suffering. You should be aware that not all of these damages may be immediately apparent, since some injuries emerge only over time. Since you only have one chance to bring a claim, you should hesitate to accept a settlement soon after an accident when the full scope of your injuries is not yet known.
If you hire an attorney, you still will make the ultimate decision about whether to accept a particular settlement offer. Your attorney cannot accept a settlement offer without your authorization. (If they do, you may have a new legal claim against your attorney.)
Releases in Settlement Agreements
Part of accepting a settlement offer from an insurer involves signing a release, meaning you no longer have the right to bring further claims arising from that accident. In other words, the form releases the defendant and their insurer from additional liability. You should make sure that the settlement covers all of your damages before you sign the release. As noted above, this concern particularly applies to the area of medical treatment. You should make sure that you have received a thorough diagnosis and treatment plan from your doctor so that you are not ambushed by unexpected costs later.
In many situations, you may need to get permission from your insurer before you sign a release. Your insurer may have certain rights against the other driver and their insurer. When you waive your rights against the other driver and their insurer, you are waiving your insurer's rights as well. If you later seek under-insured motorist benefits from your insurer, they may not provide if you did not get permission to sign the release. You'll be on the hook for covering the costs that were not covered by the under-insured driver's insurance.
Vehicle Damage Claims
While you may feel fortunate to have escaped a car accident without any injuries, you also may be concerned about covering the costs of repairing your vehicle. In most situations, insurance will cover these damages, which are usually much less substantial and contested than damages related to injuries. You should be aware, however, that the insurer will pay for costs only up to the limits of its policy. It does not need to pay for any additional fees, regardless of how severely your vehicle was damaged.
The question of which insurer pays for repairs will depend in part on whether you live in a fault or a no-fault state. If you live in a fault state, you will need to seek compensation through the at-fault driver's liability coverage, which involves proving that this driver was at fault. If you live in a no-fault state, on the other hand, you may be able to get compensation for your repairs through your no-fault insurance. Sometimes no-fault coverage does not cover vehicle repairs, however, so you should look up the rules in your state.
Understanding Collision Coverage and Comprehensive Coverage
Collision coverage and comprehensive coverage are types of car insurance that arise only in specific, narrow situations. Collision coverage accounted for any vehicle damage when the other driver was uninsured or under-insured, or when you were at fault. If you were at fault for an accident that caused only property damage, and the costs are relatively minor, you may want to cover them on your own instead. This situation could result in increased premiums, which may be more costly over time than paying for the repairs.
By contrast, comprehensive coverage applies to parked cars. It covers situations outside car accidents, such as damage caused by animals colliding with your vehicle or objects falling on your car while it is parked. You would not need to use this coverage unless there was not a human cause for the damage, or unless the driver who hit your car was uninsured or under-insured. A driver who hits a parked vehicle is usually presumed to be at fault. It will make more sense in that situation to get coverage through their liability insurance if they have it.
Paying for Repairs
Once you report the accident that caused the property damage to the insurer, it will inspect your car and estimate the cost of repairs. You can use your mechanic to make the repairs, even if the insurer recommends a different mechanic. If the mechanic accepts the insurer's estimate for the cost of repairs, you should be able to move forward. Otherwise, the mechanic and the adjuster probably will be able to negotiate an acceptable amount. In the rare event that an insurer refuses to make a fair estimate, you can file a lawsuit if the difference is substantial enough to make it worthwhile.
The definition of "totaled" is when the cost of repairing a car is higher than the value of the vehicle. An insurer does not need to pay repair costs that are greater than the fair market value of your car. Instead, it will declare the vehicle a total loss, pay you its fair market value, and take away the car. The fair market value is the value of the car at the time of the accident. It is not the value of the vehicle or the price that you paid for it when you bought it.
If your vehicle is totaled while it is still on a car loan or lease, you may need to pay back the lender or dealership for the difference. The difference owed would be between the actual value of the car and the amount remaining on the loan or the lease value. However, you can get gap coverage for your vehicle to cover this expense if you see the need.
Independent Medical Examinations
When a car accident victim claims that they have suffered injuries, the insurer responsible for paying the claim may ask them to undergo an independent medical examination (IME). "Independent" can be a misnomer because the insurer selects the doctor who conducts this exam and thus is likely to be sympathetic to the insurer's position. The purpose of an IME usually is to create a different medical opinion from that of your treating doctor. This way, the insurer has a basis to dispute your claim. However, you likely are required to undergo an IME if the insurer asks for it.
Most of the time, an IME will result in a finding that the victim's injuries are not as severe as they are asserting. Perhaps their injuries did not result from the accident, or that they are not injured. While you should be honest with the doctor, you should be careful about what you tell the doctor and how you behave in their presence. You should not exaggerate your injuries, but you also should not downplay them or agree with a doctor's statements just to be polite. If possible, you should bring someone with you to corroborate your version of events at the IME. This individual could be a friend or relative, or it could be another medical professional, which could be helpful if you want to challenge the IME doctor's findings. You should also get copies of any documents that you sign and make notes afterward about the details of what happened, including any tests and diagnoses.
Typical Situations Involving an IME
If you are bringing a lawsuit based on a car accident, the defendant's insurer probably will ask for an IME. The IME can provide information for the defendant's expert witness at trial when they challenge the extent of your injuries. Or, the IME can argue that the accident did not cause your injuries. Sometimes a victim's attorney can defeat or limit a request for an IME in the context of litigation.
On the other hand, you probably do need to undergo an IME if you live in a no-fault state and are making a claim under your no-fault car insurance. These policies usually require victims claiming to undergo an IME as part of the investigation into their injuries.
If you do not live in a no-fault state and are not trying to use your no-fault coverage, you likely do not need to undergo an IME if your insurer requests it. IME's are not always required under the terms of the policy, in which case, you should be wary of voluntarily undergoing one. Even if the seeking insurer claims that this will make your claim more comfortable to settle, these exams are rarely helpful to a victim's case.
Challenging the Results of an IME
If the findings in an IME are strongly averse to your claim, and you believe that they are unwarranted, you may have options to consider. If you brought someone to the IME, you can tell the insurer about the part of the IME that was unfair and warn them that this other person can verify your side of the story. You can also send your medical records to the insurer and point out that these are more likely to be thorough and accurate than a brief IME by an unfamiliar doctor. In extreme situations, you may want to ask your doctor to write a letter responding to the IME report, if you feel that the cost is worth it. You can also ask the insurer about the details of its relationship with the IME doctor. While the insurer likely will not provide this information, it may feel awkward about relying heavily on the report in the wake of refusing to disclose the information.
What’s My Car Accident Case Worth?
A car accident victim may need to deal with a broad range of injuries and financial burdens. Correspondingly, they may be able to recover many types of damages. Usually, these fall into two main categories: economic damages (sometimes known as special damages) and non-economic damages (sometimes known as general damages). While economic damages account for actual financial losses, non-economic damages relate to more subjective forms of harm. Medical expenses and lost income are typical examples of economic damages. At the same time, pain and suffering are the most common type of non-economic damages.
You may want to know how to calculate the value of your claim so that you can decide whether an insurer's settlement offer is fair. Unfortunately, there is no clear-cut way to calculate damages, and damages in each case depend on numerous different factors. Some insurers will use a victim's economic losses as a basis for calculating the overall award. They will multiply that figure by two or three to account for non-economic damages like pain and suffering. This method is arbitrary, however, and you should not assume that an insurer will rely on it. Your attorney may be able to give you a rough estimate based on their experience.
Medical expenses may seem like a straightforward type of damages to calculate. In some cases, though, disputes can arise over the necessity of specific medical treatments. An insurer only needs to compensate a victim for treatments that are reasonable and necessary. If the victim suffered an aggravation of a pre-existing condition, this also might give rise to a dispute. It can be hard to separate the treatment required from the accident from treatment that needed because of the pre-existing condition. An insurer may respond skeptically to a claim in which the victim did not seek medical treatment soon after the accident but only reported the symptoms later. Some injuries are not immediately identified, but the victim may need to work harder to establish the causation element of the claim.
Medical expenses can extend beyond the costs of treatment to prescriptions, mileage traveling to doctor’s appointments, medical devices, therapy appointments, and any similar costs associated with the accident. This category of damages also can cover the future costs of medical treatment, as long as they are reasonably ascertainable.
Sometimes a victim's health insurance provider will initially cover the expenses related to injuries caused by a car accident. If it is established that the auto insurer is liable, the health insurance provider may seek reimbursement from the auto insurer, which has the primary responsibility for covering these costs.
Lost Wages and Earning Capacity
An accident may prevent a victim from doing their job for a specific time while they recover. For example, perhaps you suffered a back injury that prevents you from lifting objects, which you need to do at work. If you need to spend three months recovering at home, you can get compensation for your lost income during those three months. You will need to submit clear documentation of your lost wages, most likely paychecks, and evidence of any non-salary benefits. Self-employed people may need to provide invoices or other materials showing what they would have expected to earn during that time.
Lost earning capacity can be more complex to prove. Lost earning capacity covers any permanent impact of the accident that undermines your ability to work in the future. Even if you can work to some extent, you may be able to recover damages for lost earning capacity. For example, if someone forces you to work in a lesser-paying position because of your injuries. You can submit paychecks from before and after the accident to show the reduction in your salary. However, you also may need to retain an expert to explain the effect of the injuries on your career.
Pain and Suffering
Everyone experiences an accident differently, and the degree of pain that a victim endures can be hard to quantify, as can the mental anguish that they suffer. Insurers and juries generally assume that a severe injury that requires extensive medical treatment results in significant pain and suffering. Certain types of injuries, such as broken bones and burns, are widely known to be painful. Permanent injuries also are expected to result in pain and suffering. On the other hand, soft tissue injuries and different, less visible types of injuries may be much more painful to one victim than another. If a victim did not receive substantial medical treatment for them, an insurer might not place a high value on their pain and suffering.
Evidence that supports your claim for economic damages also can help support your claim for non-economic damages. For example, medical records from your doctor may show that you were experiencing significant discomfort during an exam. If you used pain medication, records of your prescriptions might be useful. Also, if you missed time at work, this could support not only a lost income claim but also pain and suffering claim. An insurer usually will infer that someone would not miss work and lose income unless they were dealing with significant pain.
Schedule a Free Case Review with a Car Accident Lawyer in West Palm Beach
To discuss your case with a personal injury attorney in West Palm Beach, contact Donaldson & Weston. Our lawyers offer free consultations and accept car accident claims on a contingency fee basis. Call our office at 561-299-3999 or send us a message on our Contact Page to set up a case evaluation.
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