Beginner’s Guide to Using Liability in Car Accident Settlement Negotiations

Every year, insurance companies pay out hundreds of millions of dollars in car accident settlements to injured victims. If you’ve been injured in a car accident and decide to handle your own claim, the first thing you must do is establish liability.

Once you prove the other driver’s negligence in causing the accident, he becomes liable for any resulting damages. Of course, you also must prove the accident was the direct cause of your injuries.

  • In no-fault states, below a certain injury threshold, establishing liability is NOT required to get compensation.
  • In other states, establishing liability IS required to get compensation.

Gathering Evidence

Having the right evidence can be a big advantage when negotiating a car accident insurance settlement.

To prove liability, you need enough evidence showing the at-fault driver’s negligence was the direct and proximate cause of your personal injuries and property damage. Solid evidence can also prevent any allegations of contributory negligence on your part.

Types of Evidence

  • The at-fault driver’s insurance and contact information
    Phone numbers, addresses, policy number, license plate number, etc.
  • Eyewitness contact information and statements
    Eyewitness testimony can be solid evidence of liability. Res-gestae (spontaneous) statements made by witnesses at the scene of the accident can be exceptions to the hearsay rule.
  • Photographs of the scene
    Photographs of the car accident scene can be tangible proof of liability.
  • Police reports
    Police reports almost always include the officer’s opinion of negligence and liability, as well as any tickets issued to the other driver.
  • Weather report for the day of the accident
    Weather reports can help disprove the at-fault driver’s contention that weather played a role in the accident.
  • Your detailed, written summary of the accident
    Writing a detailed account of the accident immediately after it happened can help preserve evidence you might later forget or overlook.

Two Parts of a Car Accident Claim

Settling a car accident claim with an insurance company is a two-part process. Instead of having to deal with just one claims adjuster, you’ll likely deal with two. Most companies assign one adjuster to the property damage portion of a claim, and another to the personal injury portion.

Property Damage

You’ll speak with a property damage adjuster about payments for vehicle repairs and any damaged personal property that was in the car at the time of the accident (e.g. laptop, phone, jewelry, etc.).

In most cases, even if you decide to retain an attorney for your personal injury claim, you can handle the property damage portion of the claim yourself. Doing so has several advantages:

  • It may be several weeks between the accident and when you hire an attorney. You need your car to get back and forth to work, doctors’ offices, therapy appointments, etc. Waiting until your attorney gets involved with the property damage aspect of your claim can cost you time and money.
  • Attorneys generally don’t like dealing with property damage issues. Most prefer you handle that portion of your claim yourself. Their strength is in negotiating your injury compensation, and their fee comes from the personal injury portion of your settlement, not from the property damage portion.
  • Property damage claims don’t require much negotiating. Estimates for car repairs are generally consistent among auto body shops. And if your car has to be in the shop for more than a day or so, the insurance company should approve a rental car.

Personal Injury

The personal injury portion of your claim is not as simple as the property damage portion. If you decide to negotiate this part of the settlement yourself, you have to prepare. You must be able to prove liability, the type and extent of injuries you suffered, and the amount of compensation that fairly represents all your damages.

This entire website deals with handling the personal injury portion of your claim. The information is here, but you’ll have to do the work.

Tips for Negotiating a Successful Settlement

Negotiating car accident insurance settlements requires an understanding of the entire claims process. The adjuster will probably have hundreds of claims’ worth of experience under his belt. To compete, you must not only learn as much about the process as possible, but also have total command over your evidence and documentation.

Read Your Insurance Policy

Know what’s in an insurance policy. You can’t effectively negotiate unless you know the limits and exclusions of a policy. The Declaration Page contains the policy limits – the maximum amount of money the insurance company will pay in the event of an accident. Those amounts cover personal injury and property damage.

If you’re filing a claim against another driver, the insurance company will only compensate you up to the limits of his policy. Beyond that, you’ll have to go after the driver’s personal assets.

Notify Both Companies

You’ll never get to the settlement portion of your claim unless you’ve first notified the insurance company and started the claim process. Whether you live in a no-fault state or not, as soon as possible after an accident, you must notify your own insurance company and the at-fault driver’s insurance company.

No-fault insurance covers your personal injuries under the personal injury protection (PIP) portion of your own policy. It does not cover damage to your car. Some no-fault insurance covers other people’s property that was damaged by your car in the accident, such as fences, guardrails, and other property.

Within minutes of reporting the accident, the insurance company will open a file, issue a claim number, and assign your claim to an adjuster. The adjuster’s job is to collect all evidence related to the accident, determine liability, and negotiate a settlement.

The adjuster will be fully prepared and in command of liability and damage issues by the time settlement negotiations begin. She’s trained to defend her insured (the at-fault driver), and she is obligated to settle the claim for as little as possible.

You must prepare your case with the same diligence and commitment as the claims adjuster. Put time and effort into collecting the evidence you need to prove liability and damages. To succeed in a car accident insurance settlement, you must know your case backwards and forwards.

Organizing Your Claim

Start gathering evidence immediately after the accident. The more evidence you acquire, the better your chances of success. Open your own file and mark tabs for different types of evidence. For instance, one tab can be for the at-fault driver’s insurance and contact information, another for eyewitness statements, another for the police report, etc.

Having easy access to that information during settlement negotiations will keep you on pace with the adjuster. You want every advantage possible.

Know the High and Low Numbers

There should be a high and low threshold of compensation a victim is prepared to accept in any settlement negotiation. Before negotiations begin, you must have these numbers in mind. The high end would be the ideal settlement – the highest amount you feel your claim is worth. If offered, you’d accept it in a heartbeat.

The low end would be the lowest amount you feel is justified by the facts and the evidence. This is your drop dead figure. If the claims adjuster won’t agree to at least that amount, you should be prepared to end negotiations, hire an attorney, and file a lawsuit.

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