Part 3: Sample Dialogue with a Claims Adjuster...
To help you understand how to negotiate a settlement for auto accident injury claims, we've included a sample dialogue between an injured person (handling their own claim) and the insurance claims adjuster. The "Notes" section explains important strategies and tips for insurance negotiations.
More on How to Negotiate a Settlement:
Part 1: Tips for Negotiating "Hard Costs" in Car Accident Settlements
Part 2: Tips for Negotiating "Pain and Suffering" in Car Accident Injury Claims
The following dialogue between the adjuster and an injured party (Mr. Jonathan Pierce), demonstrates the typical negotiation process for an auto accident claim.
Although case specific, this dialogue represents the form and substance of most successful personal injury negotiations. Using it as a guideline will help you keep on track as your claim unfolds and hopefully draws to a successful conclusion.
The most effective personal injury negotiations are those in which the injured party is able to turn the tables on the adjuster and have him answer questions rather than ask them. Going on the offensive is important. Controlling the dialogue makes sure its focus remains on you and your claim.
ADJUSTER: "I've reviewed the bills and I'm having a hard time getting the second MRI and CAT scan approved. We can't see any reason for them."
INJURED: "Well Sir, if you would take a look at the entries in my chart on December 6th, 8th, and 9th of 2010 you will see the first MRI and CAT scan identified the origin of my pain from those areas I described to the doctor."
"Subsequent to the first MRI and CAT scan I developed separate pain and discomfort from an entirely different area of my back. That's an area the doctor apparently didn't see on the first MRI and CAT scans."
"Whether the doctor should have been able to identify all areas of injury to my back after the first MRI and CAT scans is irrelevant to me. I didn't order the additional tests, he did. If you want to subrogate against him later, that's fine, but for now you will need to pay for the tests."
ADJUSTER: "Alright. I've reviewed the reasons for the additional MRI and CAT scans. I don't know what this doctor was thinking, but after looking at the entries on your chart I will go ahead and pay for the additional MRI and CAT scan."
"About your claim Mr. Pierce... I've taken a hard look at this and I can't come close to what you're asking. That is not even close to my authority."
INJURED: "Well tell me what you're authority is so I can tell you if we are even close."
The adjuster will evade the subject, not wanting to show his
hand. If he does, he knows you will ask for $1.00
less than his authority. And if his authority is just too low, you will
then confirm you really are still miles apart on the
amount. Knowing his authority puts you in a better bargaining
saves you the otherwise wasted time of offers and counter offers. But
don't hold your breath. The adjuster isn't ready just yet to divulge
Some people think adjusters will offer less to a non-lawyer than a lawyer. That is not true!
Getting to this point in the negotiation took skills comparable to those of a competent personal injury attorney. By now the adjuster has developed a begrudging respect for you. You've figured out how to negotiate a settlement and how the game is played, and he knows it.
Some people also think that if you're representing yourself the adjuster won't take you seriously because he knows you are not a lawyer, or that he won't give your claim fair consideration because you don't have that one piece of leverage attorneys have...
The leverage of course is the ability to file a proper lawsuit and pursue it through depositions, interrogatories and all other pre-trial and trial matters. That's why adjusters exist in this world.
Adjusters are here to try and settle a claim for less than it would cost if a lawsuit was filed.
Experienced adjusters know there are non-attorney injured parties who will represent themselves throughout the negotiations and when the time comes and the adjuster says, "this is my final offer," those same injured people will fold and take the offer.
They fold because they don't want to hire an attorney and because they've already spent the settlement proceeds. They want their money now, regardless of the fairness of the settlement amount.
The same experienced adjusters know there are also non-attorney injured parties who represent themselves until the adjuster says, "this is my final offer," and if the final offer isn't appropriate they will go ahead and hire an attorney to represent them at that time.
Adjusters know that even though they spent countless hours negotiating with this non-attorney injured party, that person won't hesitate to hire an attorney if the final settlement offer is not fair. If that happens the adjuster knows he would have wasted all that time, with the case ultimately winding up in the insurance company's legal department.
ADJUSTER: "I don't see anything in the file supporting your demand. I have already fully repaired your car and have agreed to pay all of the Hard Costs. I also said I will go ahead and pay the additional five thousand dollars for the extra MRI and CAT scans."
INJURED: "I don't know if you have ever been in a serious automobile collision. If you have you might have some empathy. You should understand what it is like to feel totally helpless knowing you are about to be crushed to death between two thousand pounds of steel and a concrete wall. In those split seconds I prayed as I thought of my children and my wife."
"I saw myself sliding across lanes of traffic knowing at any second I was probably going to die. And then I hit the concrete wall."
"I still wake up nights in a cold sweat. In my nightmares I see myself in the driver's seat hurtling toward the concrete wall. I wake up in my bed grabbing at air trying to pry myself out of my car right before it hits the wall."
ADJUSTER: "I have no doubt what happened that day affected you. After looking over the case again I feel comfortable raising my offer to ($XX,XXX.XX)."
INJURED: "I think that offer is way too low. I'll think about it over the weekend and get back to you early next week".
Notes: The insurance adjuster wants to settle the case. Telling him the offer was too low, and then saying you'll get back with him early next week is a clear sign he is not going to buy you off quickly and cheaply.
You should return his call on Tuesday - not Monday. Patience can be a virtue in car accident negotiations. The adjuster is starting to realize you are not folding anytime soon.
Adjusters do treat many non-attorney injured parties with the same respect they would an attorney. Adjusters realize there may come a point when the settlement offer won't be enough. The next thing to happen will be a letter on the adjuster's desk from an attorney who has just been retained to represent the same injured party he's been negotiating with for the last four months!
INJURED: (Tuesday of next week) "I gave your offer a good deal of thought and must tell you it is substantially lower than I can accept."
ADJUSTER: "Well, how much would you accept?"
INJURED: "In the spirit of compromise and to move this case along I will reduce my demand to ($XX,XXX.XX)."
Notes: Your current offer is four times the amount of the claim.
ADJUSTER: "I don't have authority for anything near that."
INJURED: "Well this case certainly merits your obtaining it."
ADJUSTER: "I don't see anything this week that is any different from last week."
INJURED: "I can't seem to understand why you continued to insure this guy. I mean his driver's license had already been suspended for a recent DWI. He had a previous one year driver's license suspension because of the number of moving violations he's had (tickets for speeding, etc.). It's only a matter of time before he kills someone. He almost killed me."
"After our conversation this past Friday I contacted the State Board of Insurance. I was shocked to see you guys were still insuring this guy. It seems to me your insured was not the only negligent party. To me the insurance company itself could easily become a defendant in a lawsuit."
"You guys continue to facilitate and enable this guy. If you had cancelled his policy after even his second suspension he might not have been on the road that day and I might not have had to suffer for so long."
Notes: This is not the kind of comment in which you are threatening to sue... It's close, but not quite there.
ADJUSTER: "Look, I'll tell you right now my limit is $XX,XXX.XX. It looks like we aren't even close. I have been doing this for sixteen years and I can tell you I don't remember a case settling for anything close to what you are asking."
Notes: Words like "right now" are important. The adjuster is not saying he can't get more money. Instead he is saying he doesn't have authority to pay any more right now. This is the first time he has told you his limits. He's taking one last shot at you hoping you will accept his authority just because he's shown it to you. The implication being he is "opening his heart to you" saying "alright you win. I'm giving you all I have. You win."
Don't be fooled into thinking the adjuster is giving you a form of ultimatum. He's not, though he is at a break point. He probably did give you his authority, adjusters aren't supposed to lie about such things. He just doesn't want to go to his supervisor and ask for more authority. The supervisor is the one who initially authorized the limits. The supervisor did so because he knows from experience what a claim should be worth.
So when the adjuster comes back to his supervisor and says "I need more money" (authority) he is impliedly saying the supervisor's initial evaluation of the claim was wrong. (To make matters worse, the adjuster hasn't told his supervisor he's dealing with a non-attorney.)
INJURED: "I don't know why your offer continues to be so minimal. While recovering I did some research into this State's court records. It's amazing what you can find on the internet. Do you know what the average jury verdicts for cases similar have been? Some are 6 and 7 times costs. There were some lower and some higher."
"The highest verdicts were those in which the insured had a prior record of license suspensions and arrests. The juries in those cases must have been pretty upset with someone."
ADJUSTER: "But we are not talking about jury verdicts. First they take years to get to trial, and then if we lose the case it is usually appealed. That means you might not see any money for years."
INJURED: "I want to settle this case, but the settlement must be fair. You know your paltry offer is not fair. Although I am not considering hiring a lawyer right now, I am starting to wonder if I may have to.
Notes: At this point in the negotiation there seems to be a stalemate. That's normal. Now is the time to turn it up a notch.
ADJUSTER: "You don't want to hire an attorney. You know they are going to take one third (1/3) of any settlement, and to be honest, I'm not prepared to offer any more money just because an attorney becomes involved."
Notes: The adjuster is now concerned because for the first time the issue of an attorney has come up. Although you were smart enough not to say you hired an attorney, you have at least let him know you are considering doing so. The adjuster is not panicking, but he is anxiously starting to give serious consideration to all the time and effort he has already invested in this claim.
And now, after all this time he realizes he is very close to losing this negotiation to the legal department. That's something he wants to avoid. He is paid to settle cases and not knock them around for a while just to finally turn them over to the legal department.
INJURED: "You know if my driver's license had been previously suspended and I continued to drive recklessly, ultimately sending an innocent person into a concrete wall, I would be in serious trouble. If my case couldn't settle and a jury verdict was rendered against me for $30,000.00 I would be personally and financially devastated. The adverse effect on my family and me would be so very terrible."
"But if a jury verdict for $30,000.00 was rendered against your insured, (and by implication his insurance company) the insured and the insurance company would just shrug it off as if nothing happened – just a cost of doing business. Thirty thousand. A verdict like that would be less than a hiccup to them. They probably spend twice as much on their annual golf tournament."
"It is not right nor fair that you continue to insult my integrity with your offer."
Notes: An experienced adjuster knows the "hiccup" comparison is often used successfully by experienced and skilled attorneys in personal injury car accident trials.
INJURED: "I have learned a great deal while working on my claim. After reading some of the court transcripts of the attorneys' jury arguments I understand why car accident verdicts are so high."
Notes: As part of their argument skilled personal injury attorneys will bring up things like the selfishness of the insurance company. They will tell a jury that insurance companies actually calculate a certain number of jury verdicts into their bottom line. And of course they adjust their customer's premiums to make up for the high jury verdicts... "just the cost of doing business."
Attorneys will tell the jurors to wonder how many other reckless drivers the insurance company, insatiable for more premiums, continues to insure; making the jurors wonder if their loved ones will get home safely. Attorneys have been known to say things like:
"Someone has to stop these multi-million dollar insurance companies from continuing to reward dangerous drivers by keeping them insured, and by implication, on the road. The only way to get their attention is with a million dollar verdict. Any amount smaller surely won't get their attention.
Maybe that amount might put the insurance company on the same level as the injured party. A few more million dollar judgments should go a long way toward keeping these dangerous drivers off our roads, our loved ones safe, and hopefully make them think twice about insuring reckless and dangerous drivers."
After hearing your remarks the adjuster has decided it is definitely time to settle this claim. You are obviously starting to give serious thought to handing this claim over to an attorney. Reading those court transcripts may have just pushed this case over the line.
ADJUSTER: "I have been able to get authority to settle for ($XX,XXX.XX). This offer is only good for twenty four (24) hours." (FINALLY!)
Notes: The offer is three times the hard costs of the case. Take it!
At this point you should be quite proud. You've learned how to negotiate a settlement and used almost every valuable tool available. Your introduction of evidence against the insured included items even some attorneys might not have introduced. Your able and well organized presentation of the case is admirable.
You successfully introduced negotiation tools such as:
If you want to learn more about how to negotiate a settlement, read a few pages on Negotiation Strategy here.
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