Why is the insurance company low balling me and my injury claim?

Navigating Insurance Claims

Victims of negligence who attempt to navigate through the world of an insurance claim without a Little Rock personal injury lawyer are often bewildered at the amount of time expended, the delays in decisions, the records necessary for evaluation of the claim, and the seemingly insensitive small offers sometimes extended.  There are some things to keep in mind to understand why you feel like this.

Insurance Companies are in business to make money

You may be under the belief that an insurance company is in business to settle claims for injuries, damages, and losses. While that is a nice thought, the reality is that settling claims for compensation is not the primary reason an insurance company is in business.  An insurance company is primarily in business to make money for its shareholders. Reality is that an insurance company increases its profits, and enhances the amount of money paid to shareholders, by decreasing the amount of money paid out in insurance claims.

The objective of an insurance company to decrease claim settlement and increase profits means that it will employ tactics and strategies that can result in it offering a small amount of money for your injury with the hopes you will accept it.

Minor injury claims

If you are injured but not severely, you may be receiving an offensively low offer because the economics of taking the case to trial just does not make sense for an attorney. The insurance company knows that the out-of-pocket costs for an attorney to handle this type of case probably exceeds the money that the attorney would reasonably expect to make on the case. In that situation, the injured person and the attorney lose the leverage that a lawsuit and trial gives them.

Starting the claim by allowing your injuries to be boxed in

If you have been injured in an accident, you likely will be contacted promptly by a representative of the other person’s insurance company. A big mistake an injured person makes, which results in that individual receiving a low offer of compensation for injuries, is being too free in discussing an accident and injuries with an insurance company. It’s also very easy for an injured person to answer questions put forth by an insurance company representative at a point in time before even the full extent of injuries are known.  Your best strategy is to forgo immediately discussing the accident and your injuries with an insurance company until you have at least taken the time to consult with a lawyer.

It’s important to know everything about the extent of your injuries before discussing the claim

Talking to an insurance company representative too soon after the accident will cement your injuries in their claim file before the extent of the injuries is even known.  It’s common for a victim of a car crash to be taken by ambulance to an emergency room for treatment. Contrary to popular belief, emergency rooms are for life-threatening situations. For injuries that are not deemed life-threatening, most of the time, the injured person is discharged with instructions to follow up with the appropriate doctor or clinic.

Insurance companies (and juries) will often view this to mean that the person was not seriously injured.  However, it is often not until more sophisticated testing is done that the extent of an injury is known by the doctors and the victim. If you have stated your injuries before the extent of your injuries is known, it can be a reason why you are being lowballed.  And, it makes it more difficult to supplement your claim file later without the questions being posed of “well, you didn’t mention that at the outset of your claim.” “Would your memory of the injuries received in the accident be better as soon as the accident occurred or months later?”  The way to avoid this trap is to wait to discuss your claim until your injuries are known.

Attempting to Handle the Case Without a Lawyer

The most significant mistake that people make is to assume that they will be treated fairly without a lawyer. However, without a lawyer, you have no hammer or leverage for the insurance company to be fair, as you likely aren’t experienced in evaluating the true value of a claim, considering all the elements of damages. Because insurance companies know this, you will often receive a frustratingly low offer. They also know that once you have discussed the claim with them without a lawyer, you have already done damage to your case.

All of these issues should be considered prior to discussing your claim with an insurance company.  


Thanks to Steve Harrelson and our friends and co-contributors from Harrelson Law Firm, P.A. for their added insight into the reasons for lowball offers from insurance companies.

 

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