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Is there a difference in the value of a case if it is settled without a lawsuit instead of with a lawsuit?
The short answer to this question is no, right? Why should it make a difference? The injuries, lost wages, pain and suffering are the same whether there’s a lawsuit or not. Well, not so fast.
Let’s start with the basics. There are three ways to handle your case.
1) You can handle it yourself and deal directly with the insurance company.
2) You can hire an attorney to handle it for you without filing suit—just to negotiate a settlement with the insurance company. Or,
3) You can hire an attorney and file suit against the responsible party.
If you are handling the case on your own, there is no difference in “value,” per se, but the difference may be in whether you actually are offered and ultimately settle for the true value of your case. Much of that is determined by what documentation you provide to support your claim, your statement and those of witnesses, and your level of knowledge about the value of your case, so you know what to ask for. If you don’t ask for an amount that represents the true value of your claim, then it’s in the hands of the claims adjuster to offer you an amount that may or may not be appropriate. But how will you know? Do you know the insurance liability limits? Are there other sources of insurance? What is the adjuster likely to pay out? Do you know how to assess the value of your case? And how are your negotiating skills?
If you have not filed a lawsuit, but you have an attorney handling the claim for you, he will know what documentation to provide to the insurance company to support your claim, and he will do a thorough evaluation of the claim in order to know what to ask for when it comes time to make a demand for settlement. Having an attorney also changes the settlement dynamic; it levels the playing field, so to speak. The attorney may also be able to uncover other sources of compensation, which may not be readily ascertainable to you. Does it make a difference if he has filed a lawsuit on your behalf or not? Yes and no. If he has not, he is dealing directly with the adjuster. Although the goal is the same for both your attorney and the adjuster, i.e., to settle the case, the adjusters’ responsibility to their employer is to pay out as little of the insurance company’s money as possible and to settle claims promptly. Your attorney’s job as your advocate is to get a fair settlement of your claim that represents the true value of your case. Negotiating a fair settlement is a give-and-take process. Compromises are often made, however, to get the matter settled before the deadline to file suit, and you may end up with less than you might otherwise get, although likely more than if you worked directly with the insurance adjuster on your own.
If your attorney files a lawsuit, he is now dealing with another attorney on the other side rather than an insurance adjuster. The adjuster still holds the purse strings, but the attorney is relied upon for his evaluation of the case. The court is involved in the supervision of the case by this point and has deadlines for the filing of various documents and for attending certain meetings towards settling the case. Depositions of witnesses may be taken and important documents may be subpoenaed (legally demanded), such as wage loss information, medical records, etc. In other words, there is pressure from the court, but now there is also sufficient time to get more information across to the other side to support your case and to help your attorney to do a thorough evaluation. Is the value of the case different just because a lawsuit was filed? No, it’s not, but you are much more likely to obtain a settlement that reflects the true value of the case rather than one that compromises value for expediency. |
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