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Resolving a Car Accident: Filing an Insurance Claim vs. a Lawsuit


Dealing with the aftermath of a car accident can be just as much of a nightmare as the crash itself. And if there’s personal injury involved – it’s even more complicated.

If you’ve been injured in a car accident and are looking for compensation, there are two routes you can take. The first is to file a claim with an insurance company, seeking compensation from the at-fault driver’s insurance or your own insurance (there may be a section of your policy that accounts for uninsured drivers). This is the most straightforward way to resolve a car accident.

The second option is to file a lawsuit against the at-fault person, directly. This is where courtrooms and lawyers come into play. If the car accident has altered your life in a major way – whether it be due to death, broken bones, or some other long-lasting effect – this route might be the best path to justice.

Read on to learn about which option can help you find a resolution, depending on the circumstances and aftermath of the crash.

Filing an Insurance Claim

Perhaps the most common way to go about resolving a car accident, filing a claim means contacting your insurance directly – and likely the insurance of the at-fault party.

As soon as possible after the crash, call up your insurance company and open a claim for compensation. They’ll create a file for your case, which will help get the ball rolling on vehicle repairs.

If you do decide to contact the insurance company of the at-fault party, here’s some things to keep in mind:

  • Be as brief as possible. Tell them that you were hit by the at-fault party, and that you are going to claim compensation for your losses.
  • Be straightforward. Do not exaggerate your injuries or tell tall tales about what happened. This could come back to bite you later on in the process.
  • Do not sign any forms. …unless you understand exactly what you are signing or have consulted with an attorney. The insurance company may try to send you medical release forms or statements. Avoid providing the insurance company with details that may be used against you, especially about your doctor or medical history.
  • Do not give a recorded statement. It’s best to avoid going on-record unless you’ve got the aid of a lawyer at your side. For more information about when you are required by law to give a recorded statement, read Detailed Information About Providing a Recorded Statement After a Car Accident.

After you notify them about the claim, the at-fault party’s insurance company will open a file under your case number. Next, they’ll assign an adjuster to the case.

Navigating the Investigative Process

At this stage of the claims process, you’ll likely be dealing with two adjusters – one from your insurance company, and one from the at-fault party’s insurance company. Either adjuster is on your side.

The adjuster from your insurance company will be working to prove that you didn’t, in any way, contribute to causing the accident. It can be helpful to build health professional relationships with these adjusters and they have a lot of sway over what may happen in your case. Work with your insurance adjuster to ensure that they understand how you know the accident took place. The goal is for your insurance adjuster to understand and view the accident in the same manner that you do!

The other adjuster will be investigating the case to understand exactly what happened in order to determine if you could have played any part in causing the accident and whether they have any liability for the accident. If the at-fault party was responsible for the accident, the insurance coverage is valid, then the at-fault insurance company may be responsible for paying for your damages.

Here’s the strategy – give the other insurance company’s adjuster just enough information to prove your claim and damages. Ensure that you give them enough information to be certain of your personal injuries. However, avoid giving information, if possible, that could hurt your case. Here’s some of the information they may need:

  • Proof that your injuries required medical treatment. Also, indicate whether you expect to undergo more treatment in the future.
  • Documents indicating the cost of your medical expenses. Don’t exaggerate here, but be clear – they need to know the extent of your suffering.
  • Personal expenses caused directly by the accident. This includes things like alternate forms of transportation as well as medical devices and prescriptions. Save receipts to prove your point.
  • Proof of lost wages. You’ll need to show that the accident caused a reduced income, so be sure to have records of your pay stubs before the incident as well as after.
  • Evidence of the at-fault driver. Most importantly, you need to prove that their insured customer was responsible for the accident. Collect all possible evidence that could help to prove this point.

The Demand Letter

When you’re ready to present your claim for compensation, it’s time to prepare and send a demand letter.

If you’re dealing with medical damages, wait until after you reach MMI (Maximum Medical Improvement) to send this letter. MMI occurs when your condition has stabilized, and your physician determines that it’s unlikely you’ll get much better with additional treatment. The point of a demand letter is to encompass all the ways in which the accident has negatively affected your life. Good practice entails waiting until the dust has settled, so you can prove the true extent of your medical injuries.

The demand letter drafting process depends on whether or not you have an attorney. If you do, then they’ll send a detail demand letter to the insurance company demanding compensation for your injuries.

If not, then it’s up to you to write and send. What you do and do not put into that letter can make or break your settlement. Anything that could attribute negligence could be used against you in court. Click here for more information about Calculating Damages in Car Accident cases.

After the insurance company gets your demand letter, they could A) settle the claim at the amount you request, B) deny your claim, or C) make you an offer in-between. Most cases fall into the gray area of negotiation.

Filing a Personal Injury Lawsuit

If things with the settlement don’t go so well – whether the insurance company is refusing to pay, or the policy doesn’t cover the extent of your demanded compensation – a personal injury lawsuit should be considered.

Like any court case, personal injury lawsuits can be risky and complicated to go through alone and having a lawyer can make a lot of sense. Still, filing a lawsuit is a costly and time-consuming process. It is important to remember that filing a lawsuit isn’t about getting your way. Lawsuits are typically reserved for legal situations where the at-fault party is refusing to take some reasonable action and the accident victim, or his attorney, is confident about the law surrounding the issue. It is important to remember that lawsuits are somewhat rare when compared to the number of negligence claims that settle out of court!

Understand, too, that filing a lawsuit is expensive. Not only are there court fees to pay, but hiring expert witnesses and a court reporter, as well as the cost of obtaining medical records and the fees for the lawyer themselves can all get very expensive – very quickly.

Still, there are circumstances in which filing a lawsuit is appropriate.

When to File a Lawsuit

Probably the most common reason to file a lawsuit is because the at-fault party is refusing to offer a sum that is adequate to the accident victim. If the insurance company isn’t offering fair compensation for your injuries, it may worth taking the case to court. If you are considering whether to file a lawsuit or not, it may be helpful to speak to a lawyer about this option. A lawyer can help you determine whether or not filing a lawsuit is the right move for you.

In general, if a car accident has significantly altered your life, whether because of death, dismemberment, or lasting traumatic damage, you probably have a strong case on your hands. If you’ve missed a considerable amount of work due to the injuries – or have had to change employment entirely – filing a lawsuit can help secure compensation that matches the extent of your suffering.

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