The Right Way to Reject and Counter a Low Personal Injury Settlement Offer

There’s no specific time when you will send a rejection letter to the adjuster. You can’t reject a settlement offer until one is made. An official offer could come early in the negotiation process, or after a few weeks of discussion. The timing for your rejection and counteroffer depends entirely on the claims adjuster.

In the time between filing your claim and the initial written offer, the adjuster has been interviewing witnesses (including her insured), studying the police report or incident report, looking at photographs, and reviewing your medical records. In some cases, she may have even investigated the accident scene.

When she’s finished her investigation, the adjuster will send her first written personal injury settlement offer, usually after making a call to tell you what she believes your claim is worth. The adjuster will only make an offer once she’s comfortable with her assessment of liability and damages.

The Adjuster’s Authority

When preparing her offer letter, the adjuster will note in her file the dollar amount she believes your claim is worth. A second dollar amount represents the adjuster’s “authority.” This is the highest amount her supervisors have allowed her to offer to settle the claim.

A good adjuster will never tell you what her authority actually is. She may refer to it in conversation, but if she quotes a figure, you can be pretty sure it’s not the real amount.

By giving you a dollar figure for her authority, she’s trying to set a limit for you to bid against. It’s almost always an artificial amount. If she can convince you that’s the best she can offer, she’s bested you in the negotiation.

The difference between the adjuster’s actual authority, and the amount she persuades you to settle for, is basically the insurance company’s profit. The greater the profit, the better she’s done her job. Raises and promotions are often based on the gross profit the adjuster makes for the insurance company.

Keep Your Claim Moving

Most adjusters will not be proactive in making personal injury settlement offers. Even though they are 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.

For every day the adjuster holds on to that money, the company earns interest on it. Multiply those interest dollars by thousands of other claims, and the insurance company could be making millions in interest each day. (This is known as the “float.”)

You are the one who has to keep things moving along. Even though you can’t send your rejection letter until you receive the adjuster’s first settlement offer, you can be proactive and call the adjuster regularly until she makes an offer.

If the adjuster makes an offer over the phone, ask her to put it in writing, along with her reasoning behind the dollar amount. You need to know what she is basing her offer on, and how she came up with the amount, so you can address each point in your counteroffer.

The Lowball 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. She has nothing to lose and everything to gain by making a lowball settlement offer. For all she knows, you may accept it. Naive claimants accept lowball offers all the time.

Don’t take a low offer personally. It’s just business. Review the offer and begin to compose your rejection letter. Reassert your position regarding their insured’s liability and the medical necessity of your treatment. Also focus on the extreme pain and suffering you went through. Avoid any sarcasm or personal attacks.

The adjuster doesn’t expect you to accept her first offer. The main purpose of your rejection letter is to move the negotiation forward. The adjuster’s letter and your reply are just part of the process. Respond promptly and effectively to the adjuster’s letter so you can get on with discussing a realistic dollar amount for your settlement.

Basic Template of a Letter Rejecting a 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 Ms. (adjuster’s last name:)

I received your letter dated October 15th, 2014. I have reviewed its contents, including your offer of settlement. Unfortunately, the offer you made is unacceptable.

I would appreciate your revisiting the facts of the (collision/slip and fall, etc.) and your personal injury settlement offer. The (police report/store incident report, etc.) clearly reflects the (officers’/store manager’s, etc.) determination of fault. Your insured was issued a citation for (following too closely/failing to stop/speeding, etc.). At all times, I was (driving/walking safely) when your insured (collided with my car/I slipped and fell on standing water, etc.).

As a direct and proximate result of the (collision, fall, etc.), I was injured. 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, 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 amount was based on the events precipitating 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 $(dollar amount). I’d prefer not having to litigate this claim. It would be much better for us to settle this matter fairly and promptly.

If you have any questions or any of the above is not clear, please don’t hesitate to call me. I look forward to hearing from you.

Yours truly,

Your name/signature

Fair Offers

Although it’s rare, claims adjusters do occasionally make realistic settlement offers at the start of negotiations. For this reason, you should never reject a settlement offer blindly. Measure any offer against the facts of your claim, and carefully consider your response. If not, you could get into trouble if your case winds up in court.

In some states, if you reject a fair offer of settlement and the case goes to trial, you may be responsible for paying the defendant’s attorney’s fees and court costs if the jury awards an amount equal to or below the original offer of settlement. Be realistic and consider every offer carefully.

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Visitor Questions on Rejecting a Settlement Offer