Should You Take The First Settlement You’re Offered After An Accident?

After an accident, the at-fault party’s insurance company may quickly offer you a settlement if there is evidence that their policyholder is to blame. Although it can be tempting to accept, the first settlement offer is typically much lower than your claim’s actual value. Therefore, it is likely in your best interests not to take it and consult an attorney first. 

Settlements are Binding Agreements

When an insurance company sends you a settlement offer, it will be in the form of a letter that contains instructions to sign and return it to be sent a check. If you sign the form, also known as a release of liability, you give up your right to sue the at-fault party and pursue any further compensation. Although insurers may imply that their offer is a “now or never” type of agreement, it is not true. Instead, their goal is to settle claims quickly and for as little as possible. 

Injuries Can Be More Severe Than They Appear

If you accept an initial settlement, there is the risk that you do not yet fully understand the extent of your injuries and financial losses. If your injury turns out to be more serious than expected, you may end up with much less compensation than you need to make a full recovery. Take, for example, the following scenarios: 

• Once the adrenaline rush from the accident entirely wears off, you may feel more pain than you initially did. 
• Your injury requires more extensive treatment than anticipated. 
• Your wounds are not healing as expected. 
• Your injury causes unexpected complications. 
• You suffer a secondary infection. 

Therefore, before settling, it is important to either fully recover physically or reach maximum medical improvement (MMI). MMI is when a doctor determines that nothing more can be done to improve your condition. That way, you will know how your injuries will impact you in the future. 

Types of Compensation a Settlement Offer Should Take Into Account 

The first settlement offer may be enough to cover your initial out-of-pocket expenses, but your agreement should take much more into consideration. For example, the amount of compensation you receive should reflect: 

• Current and Future Medical Expenses: Emergency transportation, hospitalizations, surgeries, doctor visits, transportation to doctor visits, physical therapy, prescription medications, in-home medical care, adaptive medical equipment, rehabilitation costs, etc. 
• Current and Future Lost Income and Benefits
• Diminished Earning Capacity: If you cannot earn the same level of income as before the accident
• Property Damage Repair or Replacement
• Pain and Suffering: For the physical pain you suffer from and will continue to endure. 
• Emotional Distress: Compensation for any psychological conditions caused by the accident, such as depression, anxiety, insomnia, PTSD, etc. 
• Disability: If you suffer any permanent impairments. 
• Loss of Enjoyment of Life: If you cannot participate in activities you once enjoyed due to your injuries. 

This is by no means an exhaustive list. However, a San Diego personal injury attorney will be able to assess your case and determine which types and the amount of compensation you are entitled to.