A demand letter is used to settle a personal injury case, usually before filing a lawsuit in court. The demand letter explains how the recipient of the letter (or the recipient's insured) is at-fault, explains the damages and injuries sustained, and demands compensation. In the legal profession, drafting a strong personal injury demand letter is sometimes seen as an art form. It takes good writing skills, attention to detail, knowledge of each injury, and a certain level of restraint.
A well prepared demand letter sets the tone for settlement negotiations, and can help you avoid having to follow through with a lawsuit. Below are tips to make sure your demand letter does its job.
You may also want to see our page of sample demand letters to get a feel for the structure and substance.
"Damages" is a legal term meaning money used to compensate an injured person in a personal injury case. In the demand letter context, damages must be specifically described. For example, a demand letter is flawed when it simply states that the injured person suffered medical injuries totaling $10,000. Instead, a good demand letter will detail each injury and the exact amount of medical bills related to that injury. See Detailing Your Injuries and Losses in a Demand Letter.
A failure to calculate damages may be caused by incomplete medical records. The injured person may be anxious to receive payment, and may end up writing a premature demand letter.
In order to get the most compensation, you should request and obtain all medical records related to your injuries. It may take extra time to obtain medical records, but it is a mistake to send the demand letter before you have everything you need to make your best case. A good demand letter will name each injury and the corresponding medical bills. You should include the injury, the date of injury, the treatment performed, the date of treatment, and the exact medical charge for the treatment. Without complete medical records and bills, you cannot provide solid proof of medical bills. In this situation, the at-fault person or insurance company will likely not compensate you without medical documentation.
In many personal injury cases, you can recover compensation for emotional damages and pain and suffering associated with your injuries. It is a mistake to only seek recovery for physical injuries in a demand letter. For example, a demand letter may specify and seek compensation for all medical bills related to a car accident but neglect to seek damages for the accompanying constant pain from a severe leg injury. Pain is arguable, but you should always seek compensation for it in a demand letter.
A short demand letter runs the risk of leaving out important facts and details. However, a demand letter that is too long will likely include unnecessary details and jeopardize the strength of the letter. A demand letter should tell a story that is in chronological order with specific dates. It should be concise, but also include all the important details. Do not elaborate for dramatic effect. The generally accepted format includes a summary, background information, facts, claim for damages and the demand.
The demand letter must be addressed to the correct person or company. It typically takes time and research to obtain this information. A company may have a specific legal department that receives demand letters and other legal documents. In order to save time and energy, you can simply call the company and ask which department or person accepts demand letters and similar correspondence related to a potential claim for compensation.
Many personal injury lawyers seek to obtain the most compensation possible for their clients. However, a demand letter should not claim outrageous and unwarranted damages or excessive emotional damages and pain and suffering. Such demand letters will not be taken seriously and may hinder future negotiations.
As a general practice though, it is advisable to seek more compensation than you are willing to accept. Many insurance companies will make very low initial offers and your initial offer should be higher than you expect to or are willing to accept. It is very rare for an insurance company to accept your initial offer in a demand letter. Again, start high but not so high that it jeopardizes credibility or future negotiations. See How Much Should You Ask For in Your Demand Letter?
Sometimes, no matter how well-crafted your arguments and reasonable your demand, you won’t have a choice but to file a lawsuit and take your case to court. Often, filing a lawsuit is the catalyst needed to get the defendant to make a serious settlement offer. To learn more about when this might be necessary and what follows once you sue, see Filing a Personal Injury Lawsuit When Your Demands Go Unanswered.