How to Counter the Adjuster's Settlement Offer Following a Car Accident

If you've been involved in a car accident and have already received a settlement offer, make sure you take the time to review and counter before you accept.

By | Updated by Stacy Barrett, Attorney
Was a police report filed?
  • If you're making an insurance claim following a car accident, at some point you need to figure out your bottom line—the minimum amount of money that you will accept to settle your claim. Chances are your case accident claim will settle—upwards of 90% do. In this article, we'll take a closer look at the settlement process, with a focus on crafting a counteroffer to an insurance adjuster's initial offer.

    Overview of the Car Accident Settlement Process

    The settlement process begins when you send the insurance company a demand letter. Your demand letter should:

    • explain why the person insured by the company is at fault for your injuries and property damage
    • the nature and extent of your injuries
    • the detail of your medical treatment, and
    • details of your lost income.

    Your letter should conclude with a settlement demand, letting the insurance company know exactly how much money you want to settle your claim.

    An adjuster will likely respond to your demand with an offer. The adjuster's offer will likely be much lower than your demand. If you don't like the offer, you can make a counteroffer and negotiate from there until you reach an agreement. Here is a step-by-step breakdown of how to counter an adjuster's settlement offer.

    Step One: Determining the Value of Your Claim

    The first step in crafting an effective counteroffer is to figure out the total value of your claim.

    Calculate Special Damages

    Special damages (also called "economic" damages) compensate you for your out-of-pocket expenses related to the accident. Examples of special damages include:

    • medical expenses (past and future)
    • the cost to repair or replace damaged property
    • lost wages and loss of earning capacity, and
    • the cost of hiring someone to help you with tasks you can't perform because of your injuries (like landscapers and child care providers).

    You'll need to support your demand for special damages with documents like police reports, medical records, repair estimates, photos, and proof of lost income.

    Calculate General Damages

    General damages (also called "non-economic losses") compensate you for non-monetary damages in an injury claim. The most common types of general damages include:

    • pain and suffering (physical and mental)
    • lowered quality of life, and
    • loss of companionship (paid to family members in wrongful death cases).

    General damages are harder to calculate than special damages. Most adjusters use a multiplier to calculate general damages. For example, an adjuster might multiply your total medical costs by a factor between 1.5 and 5 to estimate your general damages.

    AllLaw's settlement calculator can help you estimate a reasonable value for your claim.

    Add Special and General Damages Together

    The sum of your special and general damages is a good ballpark estimate of the value of your claim.

    Adjust the Value of Your Claim

    Next, adjust the sum of your special and general damages down based on a rough estimate of the amount of money you'll save if you settle the case instead of filing a civil lawsuit and going to trial. The extent to which you will adjust the value of your claim will depend on a number of factors, including your assessment of how likely you are to win at trial. Ask yourself: Is the other party clearly at fault? Do you plan to represent yourself or hire a lawyer? How much uncertainty and risk can you handle?

    Step Two: Compare Your Settlement Value to the Adjuster's Value

    The next step in making a counteroffer is to compare the value of the adjuster's offer with your valuation. Compare where you differ. Check to see if the adjuster valued certain damages less than you did or if the adjuster did not provide compensation for certain damages at all.

    Step Three: Prepare a Counteroffer

    Finally, draft a letter as a counteroffer. Start by summarizing the offer that was made to you. State that the offer is too low and explain why it is too low by drawing on your research. You might want to consider attaching some documents, such as bills, as evidence to support your position. Finally, end by clearly stating the amount for which you will settle the claim.

    Think about sending this letter directly to the claims manager instead of the adjuster. The adjuster may not have the authority to engage in further negotiations at this point, and there is no harm in showing that you're willing to escalate the process and stand up for your rights.

    Talk to a Lawyer

    Some people think you only need to hire a lawyer if you're going to court. But getting a car accident lawyer involved in the insurance claim process can help you maximize the value of your claim.

    A lawyer can answer your questions, help you estimate the value of your claim, and take on the stress of negotiating with an adjuster for you. Learn more about how a car accident lawyer can help you. You can connect with a lawyer directly from this page for free.

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