One of the most unnerving points of any personal injury case comes when the first demand letter is sent.
The demand letter details your losses and why you believe you have a right to compensation from the other party. It’s essentially a preview of the case that your attorney would make in court if the case were to get that far — and it starts the real negotiations rolling that can ultimately lead to a settlement.
So, what happens once the letter is sent?
1. The other party’s insurance company can either accept your offer or make an offer.
Some attorneys prefer to make a demand for a specific dollar amount from the start — which gives the insurance company a chance to accept the offer and be done with the whole case. Other attorneys may choose to lay out your losses but avoid naming the dollar amount that will settle the case to see what the insurance company will offer. If you have a preference, this is something you should discuss with your attorney before the letter goes out.
2. You can begin negotiating on a settlement.
Whether the original letter demands a specific amount or lets the insurance adjuster take the lead, there may be a bit of negotiation next if the figure you have in mind and the figure the insurance adjuster has in mind are too far apart. There’s usually a lot of paper correspondence and occasionally a few phone calls that take place to see if a happy medium can be reached.
3. The other party’s insurance can refuse to pay you — or you can refuse to accept what they offer.
Sometimes, there’s no way to meet in the middle. The particular insurance company involved may deny their client’s liability or offer an amount so low that you feel insulted, not compensated. In that case, your attorney will take it to the next stage, which usually means filing an actual lawsuit. Similarly, if the insurance company tries to ignore the letter, your attorney can put it on their priority list by filing a lawsuit — which gives them a limited time to respond or risk defaulting and owing whatever you ask.
An attorney can provide more information about how to recover compensation for your personal injury.
Source: FindLaw, “What Is a Demand Letter?,” accessed Aug. 09, 2017