Let’s suppose you just hung up the phone after agreeing on a settlement amount with the claims adjuster. At this point you’re only a few steps away from wrapping up your claim and receiving compensation, but you’re not out of the woods yet. Let’s take a look at those final steps to make sure you don’t miss anything…
Step One: Confirmation Letter
Within 24 hours after coming to a verbal agreement with the adjuster, you need to send a letter confirming the amount you agreed upon. Make several copies of the confirmation letter. Send one to the adjuster by certified mail, return receipt requested (RRR), and keep a copy for your records.
You need to send the letter Certified RRR so you have proof the letter was mailed, and proof of the date the adjuster received it. At about the same time, you should receive a similar confirmation of settlement letter from the insurance company.
Sample Confirmation of Settlement Letter
Date of Letter
Insurance company name
Insurance company address
Date of injury
Dear (Adjuster’s name):
Pursuant to our telephone conversation on (date), please let this letter confirm we have agreed to settle my claim referenced above, in full, for the amount of (your agreed settlement amount).
Please mail the insurance company’s check and release to me at the following address:
Your street address
Your city, state, ZIP
If you have any further questions or clarification, please don’t hesitate to contact me.
Step Two: Release Form and Settlement Check
You should receive a release form from the insurance company within a few weeks. Some insurance companies send the settlement check along with the release form, and state you must sign and return the form before you cash your check. However, most companies won’t send your check until you sign and return the release.
Either way, read the release form very carefully. Although the insurance company probably won’t make any mistakes, it’s always important to know what you’re signing. Make copies of the signed release, and the check, and keep them in your personal file.
A note on property damage claims…
If you’ve also filed a property damage claim, and it hasn’t been settled by the time you receive your personal injury settlement, carefully check the release form for any language stating the settlement check includes your property damage payment.
Do not sign the release until you’re absolutely sure your property damage amount will be paid separately, or you verify it’s included as part of the settlement check you just received. Usually, property damage claims are settled quicker than personal injury claims, but not always, so you must review the release form carefully.
Understanding the Release Form
Insurance companies, along with varying states, provinces, and other legislative bodies, may require unique language in their releases. The exact wording may differ, but they all contain the same basic information. This language can take up a full page or more, but generally covers four important items you should understand:
“By signing the release, you fully and completely release and indemnify (the at-fault party) and (the insurance company) from having to pay you any additional money.”
This means that even if you later discover you have additional injuries related to the same accident, you will not receive any further compensation.
“(The insurance company) is settling your claim, but does not publicly acknowledge or admit the company nor (the insured) had any fault for the accident or your resulting injuries.”
Don’t be overly concerned with this language. The insurance company’s refusal to officially admit fault has more to do with their statistics and public relations than anything else. The language has no bearing whatsoever on your settlement amount.
“You acknowledge that this is the only legitimate legal claim you have against (the at-fault party) and (the insurance company).”
This means you waive all rights to file another legal claim against the at-fault party or the insurance company, based on this injury-accident. You agree that the money you receive satisfies this claim and any other claims you might want to bring at a later time.
Unless your claim is complicated, involving different layers of fault or additional liability issues (such as in a medical malpractice or defective product case), you don’t need to worry about this language. If your claim is this complicated, you’ll need an attorney to sort through the details.
“The settlement terms in the release include all the agreements, promises, and representations made to you, both written and oral, from (the at-fault party), (the insurance adjuster) and (the insurance company).”
This statement usually comes at the end. It means that by signing the release, you confirm you’ve made no other side agreements with the at-fault party, the claims adjuster, or anyone else from the insurance company. They include this language so you can’t later say you were promised additional money for future expenses related to this claim.
Ask Questions Before Signing
If you have any questions about the language contained in the release or about the settlement amount you just received, DO NOT endorse and cash the check. Get answers before moving forward. Although you may need the money to pay your bills, once you’ve signed the release and deposited the check, you won’t be able to re-open the claim.
There are no second chances after signing a release. Contact the adjuster if you have any questions. Read the release thoroughly and write down anything that’s unclear. The adjuster’s job is to settle claims, and answering your questions before you sign the release is part of the process.
If you’re not satisfied with the adjuster’s answers, ask to speak with a supervisor. Remember, you are responsible for making sure everything is correct. Once you sign and return the release, the insurance company will close your case. They legally owe you nothing more, not even a return phone call.
Filing a Complaint
You should receive your release and settlement check within thirty days after you’ve reached an agreement with the adjuster. If it’s been more than a month, and you’ve contacted the insurance company several times to follow-up on your settlement check, you can file a complaint with your state insurance board.
Every state has an insurance regulatory body. They have the power to intervene when the relationship between a claimant and insurance company breaks down.
Before contacting the state board, have all documentation related to your claim gathered and in order. The board will assign an investigator to your case. That investigator may ask to review your documents, especially those related to the final settlement agreement.
After the review, the investigator will contact the insurance company to find out why you haven’t been paid. Although these breakdowns don’t occur often, you can be confident your check will arrive soon after the insurance company hears from the investigator.
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