Still waiting for your settlement check? Here’s what you can do if the insurance company is withholding your injury compensation.
Your personal injury settlement check should arrive within six weeks of reaching an agreement with the insurance company. If not, there should be a good reason for the delay.
If your check is unreasonably delayed, there are actions you can take to speed up the process.
Here we explore what can cause delays, and what you can do to get the insurance company to issue your check.
When to Expect Your Settlement Check
Let’s say you or your attorney have successfully negotiated an insurance settlement for your personal injury claim or accident case. You just want to get your settlement money, pay your accumulated bills, and get on with your life.
Unfortunately, the insurance company won’t simply put the money in your hands the minute you reach an agreement.
The average wait for a settlement check in a car accident or slip and fall case is about six weeks after reaching a compromised agreement. Minor injury claims with only one or two medical bills may be wrapped up sooner.
High-dollar settlement amounts from a personal injury lawsuit or wrongful death may take much longer, especially if multiple at-fault parties are involved.
4 Steps from Agreement to Payout
Insurance companies, like any big company, have internal procedures for financial transactions. Whether you’ve been injured in an auto accident or another incident, the insurance claim settlement process follows four general steps.
- Reach an Agreement: After you, or your personal injury lawyer, have accepted a settlement offer, a copy of the settlement agreement and release will be mailed.
- Review the Documents: When your copy of the settlement agreement arrives, you or your lawyer will carefully review the compensation amount and terms in the settlement document to be sure it matches the verbal agreement.
- Verify Deductions: Make sure any subrogation or medical provider liens that must be paid from your settlement are paid in the right amount to the correct party.
- Resolve Concerns: Check with the adjuster or an attorney if you don’t understand the language in the settlement documents, or if the amounts are incorrect. When you are satisfied that your questions are answered, you can sign and return the agreement.
When you send back the signed agreement, someone other than the claims adjuster must review it, confirm the insured and the company are legally protected, then send the authorization to another department to cut and mail your check.
Why a Settlement Check Might Be Delayed
There may be a logical explanation for why the insurance company hasn’t issued your settlement check in a reasonable amount of time.
Common reasons for insurance company delays include:
- You haven’t signed and returned the settlement and release forms.
- Your claims adjuster may have taken unexpected time off for illness or family leave after settling your claim, without sending your agreement for approval.
- The supervisor responsible for signing off on your agreement is out of the office.
- A pandemic, natural disaster, or another event has slammed the insurance company’s resources, creating delays throughout the company.
If a personal injury attorney is handling your claim, there might be other reasons you’re still waiting for your settlement check.
Delays with your attorney may be due to:
- Your attorney hasn’t received the check from the insurance company yet, for reasons mentioned above
- The insurance company check arrived while your attorney was in trial for another case
- Your attorney has been notified of liens against your settlement proceeds and is waiting for confirmation on each lien
- Your attorney is in the process of negotiating your medical bills and liens, so you end up with more of your money
Call your attorney’s office or send an email to ask about the status of your case.
The insurance company will send the check to your attorney, who will deposit the funds into an escrow account.
You will get a check for your portion of the settlement funds after deductions for:
- Legal fees
- Legal costs (like for expert witnesses)
- Medical expenses
- Health insurance company liens
- Unpaid child support
Your attorney is legally obligated to hold on to your settlement funds until outstanding liens are paid. Some “super lien” holders like Medicare and Medicaid are notoriously slow in issuing their billing statements.
It also takes time for your attorney to negotiate with medical lien holders to reduce or eliminate some of the liens against your settlement.
Your attorney won’t get paid until you do. When your check is finally issued, you’ll get a detailed, written explanation for the disbursement of every penny, including the attorney’s fees.
Take Action on Settlement Check Delays
Waiting for a settlement check can be frustrating. If you handled your injury claim without legal representation and have already sent back the signed Agreement and Release, there are a few things you can do to resolve delays.
If you were told to expect your check in two or three weeks, you should probably wait at least three weeks before calling.
If you haven’t received your check within three weeks, call the adjuster. If they say the claim is still in process, ask how much longer it will be before you receive your check. Pin the adjuster down. Note the date and time you called, and what the adjuster told you.
Wait a few days and call again. Unless there’s a good reason why your settlement check is delayed, calling the adjuster every few days is reasonable.
Note the date and time of each call. Also, note what you said and the adjuster’s response. If you can only get the adjuster’s voicemail, leave a message stating you still haven’t received the check as promised.
If they say the check is in the mail, ask for the check number, and how it was sent. Insurance companies often send checks through the United States Postal Service with no tracking. If a few days have gone by and you believe the check was lost in the mail, demand a replacement check be sent with a tracking number.
Going Up the Chain of Command
You can ask to speak with the adjuster’s supervisor. The supervisor should be able to give you an explanation for the delay, and an approximate date when you’ll receive the check.
If there’s a problem, the supervisor should take whatever action is necessary to make sure you receive your check promptly. If it’s been several weeks since you returned the signed release agreement, let them know you’d like the check sent overnight or express delivery.
Each time you call, note the date and time and write a detailed summary of the conversation, especially the reasons given for the continued delay.
If you’ve been waiting a month or more for your settlement check, with no reasonable explanation for the delay, consider consulting a personal injury attorney or filing a complaint with your state insurance board.
But before you do, call and tell the adjuster what you’re going to do unless you receive your check within the next week.
Filing an Insurance Board Complaint
If you still haven’t received your settlement check after several follow-up attempts with the adjuster, contact your state’s insurance commissioner. Most state insurance departments have enforcement power, meaning they can levy fines and take other punitive action against insurers who violate state regulations.
Before you contact the insurance board, have all your claim documents in order, especially the notes of your post-settlement discussions with the insurance company.
An insurance investigator will be assigned to your case after you file a complaint. The investigator will contact the insurance company and demand an explanation for the delay in issuing your check.
Contact from a state insurance investigator is often all that’s needed for your check to be delivered promptly.
The state insurance board’s intervention won’t change the amount of your settlement check. You may think the insurance company should have to pay an additional amount to compensate you for the frustration and additional work you had to do. Unfortunately, state regulatory bodies don’t have that kind of power.
Watch Out for Insurance Company Bad Faith
If you’ve reached an agreement, yet the insurance company refuses to send your check with no legitimate reason for the delay, you may have grounds for a bad-faith lawsuit against the company.
For example, each state has a statute of limitations on injury claims. If you haven’t finalized your settlement or filed a lawsuit against the at-fault person before the statutory deadline, you lose the right to seek any compensation for your injury.
The insurance adjuster knows a verbal settlement agreement won’t stop the statute from running out, and they don’t have to warn you that the deadline is imminent. If the adjuster intentionally delays sending you the settlement paperwork in an attempt to void your claim, that’s bad faith.
If the statutory deadline on your claim is only months away, seek immediate legal advice. Your attorney may have to file a lawsuit to preserve your right to compensation.
If you have to file a personal injury lawsuit because the defendant’s insurance company delayed your settlement, the insured party may also have grounds for a bad faith action against the company.
Suing the Insurance Company
Bad faith cases are filed against the insurance company, not the insured. Some states only allow bad faith lawsuits to be filed by the (first-party) policyholder. Third-party bad faith complaints (your claim against someone else’s insurance policy) may have to go through the state insurance commissioner’s office.
Discuss your option with an experienced personal injury lawyer. If you reached a verbal settlement with the at-fault party’s insurance company, and sent a confirmation letter or email, you may have a cause of action for bad faith or for breach of contract.
A successful bad faith lawsuit against an insurance company can result in thousands of dollars in punitive damages, well beyond the amount of the original personal injury settlement agreement.
Don’t try fighting the insurance company’s defense attorneys on your own. You can contact an attorney at any time to discuss your personal injury case. Most injury attorneys offer a free consultation for injury victims.
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