How to Respond to a Low Injury Settlement Offer – Sample Counteroffer Letter

Here’s how to counter a low-ball settlement offer and strategies for negotiating fair personal injury compensation.

Negotiating a fair settlement with the insurance adjuster is the hardest part of handling your own personal injury claim.

After recovering from a slip and fall or car accident, you expect your injury claim to be paid quickly so you can get on with your life.

But what if you get a settlement offer that’s too low? One that won’t even cover your medical bills, much less your pain and suffering? How should you respond?

Here’s where we unpack why insurance adjusters make low-ball settlement offers, how to reject unacceptable offers like a pro, and moving on to get fair compensation.

Why Adjusters Make Low Settlement Offers

Most adjusters start with a low-ball settlement offer for every claim as part of their negotiating strategy, regardless of factors affecting the value. After all, insurance claims adjusters are rewarded for closing claims as quickly and cheaply as possible.

Leading up to the negotiation phase of the injury claim process, the adjuster will talk to the insured, interview witnesses, study the police report or incident report, look at photographs, and review your medical records.

The adjuster will compare their findings to the information you’ve provided in your settlement demand letter. They will only make an initial offer after completing their assessment of liability and damages.

Factors That Affect Injury Compensation

Just as you calculated your claim’s value by combining your hard costs with an additional amount for your pain and suffering, the adjuster will also calculate what they think your claim is worth.

After the base calculations, the adjuster will make value changes based on a variety of factors.

For example, the adjuster may believe:

  • You share liability for the circumstances leading to your injuries
  • Testing or treatments for your injuries were excessive or out of proportion
  • Your injuries arise from a preexisting condition
  • You made your injuries worse by delaying treatment or failing to follow doctor’s orders
  • The number of days you missed work isn’t justified

Adjusters are generally skeptical of soft tissue injuries like whiplash injury claims. They also tend to put a higher value on medical treatments provided by a physician instead of a chiropractor.

Insurers are only required to cover reasonable and customary medical expenses.

Adjusters are very familiar with “accident doctors” who order repeated or unnecessary tests and medical treatments to inflate your medical bills. If an “accident doctor” treats your injuries, you may end up on the hook for most of the inflated bills.

Even when there are no applicable factors that might lower your claim value, the at-fault party’s insurance company has no legal obligation to fully compensate you for your injuries. They only have to pay out as much, or as little, as you are willing to accept.

Sample Letter Rejecting a Low Settlement Offer

When you finally receive the first settlement offer, be prepared to see a low figure. The adjuster may claim you were partially at fault, or your injuries weren’t serious enough to merit the amount of medical treatment you received.

The adjuster is testing you. Some claimants jump at the first offer, just to get it over with. Others get mad, jump on the phone, and spout off information the adjuster can use against them.

For example, if the adjuster knows a claimant has unpaid bills piling up, or a large expense looming, they might drag out negotiations until the person is desperate enough to take a lower offer. Or, the person may reveal they want to settle before an upcoming vacation or family event.

If you’re not sure you want to continue negotiating with the adjuster, talk to a personal injury lawyer about the value of your claim.

Don’t take a low offer personally. It’s just business. Review the offer and begin to compose your rejection letter. You’ll need to respond to each reason the adjuster gave for the low offer.

The adjuster doesn’t expect you to accept the first offer. The main purpose of your rejection letter is to move the negotiation forward. The adjuster’s offer and your reply letter are just part of the process.

Always work down, in small increments, from your initial demand. Never negotiate up from the adjuster’s low-ball offer.

Respond promptly to the adjuster’s letter so you can get on with discussing a realistic dollar amount for your settlement.

Sample Letter: Rejecting a Low Settlement Offer

Date of letter

Your name
Your address

Adjuster’s name
Insurance company’s name
Insurance company’s address


Your name and the insured’s name
Your date of birth
The claim number
Date of the injury

Dear Mr./Ms. (adjuster’s last name):

I received your letter dated (date) with your offer of settlement. Unfortunately, the offer you made of ($ amount) is unacceptable.

I would appreciate your revisiting the facts of the (car accident/slip and fall) that support my initial settlement demand.

The (police report/store incident report) clearly reflects the (officer’s/store manager’s) determination of fault. Your insured was issued a citation for (following too closely/failing to stop/speeding). At all times, I was (driving/walking safely) when your insured (collided with my car/I slipped and fell on standing water).

I was injured as a direct and proximate result of the (collision/fall). I subsequently required the medical attention and treatment which is clearly and accurately detailed in my medical records, which you have in your possession.

The pain I’ve suffered due to your insured’s actions has been life-altering. I haven’t been able to do basic daily activities such as (dressing, caring for my child, driving, etc.) and have lost out on family moments that mean more to me than anything.

My injuries were real, as were my damages. My initial demand amount was fair based on those damages and based on my research of similar injury cases. My demand was based on the reasonable medical costs for treatment of my injuries and the subsequent losses I incurred.

You have presented no evidence contrary to the evidence I submitted to you.

In the spirit of compromise, and as an effort to amicably settle this matter, I will reduce my settlement demand to ($ amount). I’d prefer not to have to litigate this claim. It would be much better for us to settle this matter fairly and promptly.

Please don’t hesitate to contact me with any questions. I look forward to hearing from you.

Yours truly,

Your name/signature

Strategies for Moving from Low Offer to Final Settlement

You’re the one who must keep settlement negotiations moving along – but don’t rush. You can’t send your rejection letter until you receive the adjuster’s first settlement offer, but you can call the adjuster if there is an unreasonable delay after submitting your demand.

Most adjusters will take their time in making personal injury settlement offers. Even though they’re under pressure to settle claims as quickly as possible, they’re under equal pressure to hold on to the insurance company’s money as long as possible.

Each adjuster’s negotiation style is different. Some are happy to leave you hanging. They want to see if you’ll start negotiating against yourself by making a reduced demand rather than wait for their offer.

Keep in mind that most states require insurance companies to negotiate injury claims in good faith, including responding to written correspondence in a reasonable time frame.

Ignoring your demand for more than a month may be an indication of bad faith negotiation tactics.

The Adjuster’s Settlement Authority

Sometimes the adjuster will say your demand exceeds their “authority,” meaning the highest settlement offer the adjuster is allowed to make without approval.

Adjusters often cite their limited authority as a negotiation tactic. The adjuster’s pay and bonuses depend on how much money they save for the company, so they’ll pull out all the stops to get you to settle for less.

If you have a strong case, with credible evidence to back up your demand, don’t worry about the adjuster’s “authority” level.  Even if the adjuster can’t sign off on a higher settlement amount, their supervisor can.

If the adjuster makes an offer over the phone, ask for confirmation of the offer in writing, along with their reasoning behind the dollar amount. You need to know how the adjuster came up with the amount so that you can address each point in your counteroffer.

Accepting a Reasonable Offer

Although it’s rare, claims adjusters do occasionally make fair settlement offers at the start of negotiations. More commonly, you and the adjuster will go back and forth before reaching a compromise agreement.

When the adjuster has accepted your economic damages, like medical bills and lost wages, negotiations are then focused on your non-economic damages, like pain and emotional distress.

Professional negotiators understand that a good settlement agreement happens when both sides give something up.

If you get a reasonable settlement offer, take it. Holding out for your full demand could cause you to end up with nothing, especially if the at-fault party has low insurance policy limits. Filing a personal injury lawsuit is no guarantee you’ll get more money. You never know what a jury will do.

In some states, if you don’t accept a fair settlement offer and your personal injury case goes to trial, you may be responsible for paying the other party’s legal expenses. Be realistic and consider every offer carefully.

When Claim Negotiations Stall

Watch out for the legal deadline, called the statute of limitations, for injury claims in your state. The adjuster knows if you haven’t settled your injury claim or filed a lawsuit before the deadline, you won’t be entitled to a dime.

If the adjuster won’t come off an unreasonably low settlement offer or tries to blame you for your injuries, don’t hesitate to seek legal advice from an experienced personal injury attorney. Most personal injury law firms offer a free consultation to injured victims.

Sometimes a letter from your attorney is all it takes to get a stubborn or lazy adjuster to make a fair personal injury settlement offer.

Responding to Low Settlement Offer Questions

Charles R. Gueli, Esq. is a personal injury attorney with over 20 years of legal experience. He’s admitted to the NY State Bar, and been named a Super Lawyer for the NY Metro area, an exclusive honor awarded to the top five percent of attorneys. Charles has worked extensively in the areas of auto accidents,... Read More >>