If you or somebody you care about has been injured due to the careless or negligent actions of somebody else, you may be entitled to various types of compensation for your injuries and other losses. The vast majority of personal injury claims are resolved through settlements with insurance carriers.
Here, we want to discuss what a personal injury settlement agreement is so that you have an idea of what to expect if you are going through the personal injury lawsuit process.
A settlement should provide injury victims with compensation
Personal injury settlements are designed to provide compensation to the injury victim so that they can be made “whole.” There are various types of compensation available in these cases, including both economic and non-economic compensation.
- Economic compensation is also called special damages and refers to the payment a victim receives for things that are relatively calculable. This could include the following:
- Medical bills
- Lost income
- General household out-of-pocket expenses
- Property damage expenses
- Non-economic compensation is also called general damages and refers to the types of compensation that are more immeasurable and harder to calculate. This can include the following:
- Pain and suffering damages
- Loss of quality of life damages
- Emotional distress damages
- Loss of future earning potential
- Loss of consortium (for your spouse)
A personal injury settlement likely needs to be negotiated
One thing that we need to stress here is that insurance carriers or not your friend. They do not want to pay large settlements for any injury case, and they will use various tactics in an effort to limit how much money they pay you in a settlement. They may even try to deny a claim altogether.
One common tactic that insurance carriers use is to offer an extremely low settlement at first. Often, injury victims jump had a first settlement offer because they need compensation quickly. However, settlement agreements often involved multiple rounds of back and forth demands and offer between the injury victim and the insurance carrier.
A qualified Denver personal injury attorney with experience handling settlement negotiations will be an invaluable asset in these cases. An attorney will understand the various tactics used by insurance carriers to lower the final settlement amount, and they will counter these tactics with demand letters based on the facts of the case.
A personal injury settlement is final
It is important for injury victims to understand that a personal injury settlement will be final. Victims will not be able to recover any additional compensation for their injuries or other losses after they have signed a settlement agreement, regardless of whether or not they later discover that their injuries are worse than they originally seemed.
That is why we never recommend that a personal injury claim be settled until a person has reached maximum medical improvement and that they have a thorough understanding of the total losses they have incurred because of the incident.
A lump-sum payment or a structured settlement
Personal injury settlements will either be received all at once in a lump sum payout or through a structured settlement where the claimant will receive payments on a regular basis for a set amount of time until the total compensation is paid.
There are various drawbacks and benefits to each type of payout, and we recommend that injury victims work with a personal injury attorney with experience handling these cases when making this decision.