Still waiting for your settlement check? Here’s what you can do if the insurance company is withholding your injury compensation.
Let’s say you or your attorney have negotiated a settlement with the insurance adjuster to resolve your personal injury claim.
It’s been a couple of weeks, and you’re beginning to wonder why the check hasn’t arrived. What do you do?
Your check should arrive within a reasonable timeframe, or you should be given a good reason for the delay.
If your check is unreasonably delayed, there are actions you can take to speed up the process.
Find out how long you should wait for your check, what can cause delays before you get paid, and what you can do to get the insurance company to issue your check.
Why Settlement Checks Might Be Delayed
You just want to get your settlement money, pay your accumulated bills, and get on with your life. Unfortunately, the insurance company won’t put the money in your hands the minute you reach an agreement.
A two or three-week delay is typical, and even four or more weeks might be acceptable, especially if there’s a legitimate reason.
There have been cases where a settlement agreement was reached, and the file was subsequently misplaced or overlooked. If it takes longer than a month to receive your settlement check, it’s time to start asking questions.
Insurance companies, like any big company, have internal procedures for financial transactions. That means someone other than the claims adjuster must review your settlement agreement, make sure the insured and the company are legally protected, then send the authorization to another department to cut and mail your check.
There may be a reasonable explanation for why the insurance company hasn’t issued your settlement check.
Common reasons for delays include:
- You haven’t signed and returned the settlement and release agreement.
- Your claims adjuster may have taken unexpected time off for vacation, illness, or maternity 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 natural disaster or another event in a different part of the country has slammed the insurance company’s resources, creating delays throughout the company.
If your personal injury attorney settled 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 liens, so you end up with more of your money
Take Action on Settlement Check Delays
Waiting for a settlement check can be frustrating. What you can do about the delay depends on whether you were represented by an attorney or handled your injury claim yourself.
When You’re Represented by a Personal Injury Attorney
Pick up the phone or send your attorney 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 receive a check for the balance of the settlement funds after deductions for:
- Attorney fees and costs
- Medical liens
- Other liens, like 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 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.
When You’ve Settled Your Claim on Your Own
You sent a confirmation letter, and now you’re just waiting to receive the check.
If the claims adjuster said you’d receive the paperwork and check within a week or so, then calling after a week is reasonable. If you were told it would be two or three weeks, you should probably wait at least two 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.
Going Up the Chain of Command
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 by 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 let the adjuster know 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 or insurance board.
States have different names for the authorities in charge of regulating insurance companies in their jurisdiction. Whatever the name, these governmental bodies all serve similar functions. They oversee the regulations governing all insurance companies doing business in their state.
Most of these state insurance bodies have enforcement power, meaning they can levy fines and take other punitive action against insurance companies who violate state regulations.
Before you contact the insurance board, have all your paperwork in order, especially the notes of your post-settlement discussions with the insurance company.
An insurance investigator will be assigned to your case once 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.
A bad faith lawsuit against the insurance company is different from a personal injury lawsuit against the person who caused your injuries, like an at-fault car driver.
For example, each state has a statute of limitations on injury claims. The statute sets the legal deadline for settling your injury claim or filing a personal injury lawsuit.
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.
It’s up to you to know the statute of limitations for your injury claim. In some states, the deadline is as short as one year after the injury or accident occurred. You must act quickly to file a lawsuit against the at-fault party before the statute runs out, or you forfeit your claim.
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.
There are several insurance company tactics that might qualify as bad faith.
Suing the Insurance Company
To pursue a bad faith case, you’ll need a skilled attorney. Bad faith cases are filed against the insurance company, not the insured. You can bet the company will unleash an army of aggressive defense lawyers to fight your allegations.
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.
Although you can file a lawsuit without first trying other options, you should go through your state insurance board’s complaint process before filing suit against the insurance company.
Your efforts show a jury that you took reasonable actions to secure your settlement check before resorting to litigation. You should always act in good faith, even if the insurance company doesn’t.
You can contact an attorney at any time to discuss your options. Most personal injury attorneys don’t charge for an initial consultation. It costs nothing to find out what a good attorney can do for you.
Video: How to Handle a Delay Receiving Your Check
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