Whenever you’ve been injured in an accident, such as a car wreck, and you’re seeking compensation, there’s a good chance you’ll be dealing with insurance companies and their adjusters. In the case of a car accident, you’re going to be dealing with the “at-fault” persons insurance and in a premise liability case, like if you injured yourself in a slip and fall accident, you’ll be dealing with the property owner’s insurance. Additionally, you might have to deal with your own insurance company. Overall, in the event that you were injured, you’re most likely going to have to deal with some insurance companies, so it’s important to understand how these companies and their adjusters work.
At our personal injury law firm in Wichita Falls, a lot of clients are somewhat surprised when we tell them that insurance companies and their adjusters are not there to help them. And they are even more shocked when they hear that some of these insurance companies completely deny claims even when their insured was the one who caused the accident. Our clients just can't understand why they would do that.
Adjusters know that they can deny some claims and the average person, who is probably not aware of their rights, will choose not to fight it because they don't know how. These decisions add up over time and they save the insurance companies millions of dollars.
What’s an Insurance Adjusters Motive?
When an accident happens and an insurance policy covers that accident, a claim is filed with the insurance company and an adjuster, a trained employee of the company, is assigned to the claim. The adjuster’s job is to investigate exactly what happened and to determine how much the claim is worth. It’s important to keep in mind that the adjuster is trained to keep any and all payouts as minimal as possible in order to make sure the insurance company is more profitable. After all, these adjusters collect their paychecks from the insurance companies, not you. Their focus is always on minimizing the claim.
However, while their goal is to pay as little as possible, they also want to avoid any potential lawsuits. They want to avoid this because if a lawsuit makes it all the way to trial, the verdict (decision) on the case such as who is liable (at-fault), whether damages (compensation) can be awarded, and how much can be awarded rests in the hands of a judge or jury. If the judge or jury is sympathetic to the plaintiff (the person who brought forth the lawsuit), the damages they award could be very high and potentially higher than what the policy limits were. Additionally, attorney fees and other fees associated with trial can add up very quickly, which does not help the insurance company’s ultimate goal: pay as little as possible and keep profits high. Therefore, the potential of a lawsuit and going to trial is risky territory for insurance companies.
The insurance adjusters must walk this line in between getting the claimant to accept the lowest possible settlement and avoid filing a lawsuit.
If you deal with the opposing adjuster on your own, they will utilize different tactics they were trained in to try and get you to settle your case before getting a lawyer involved, often with low-end settlements. It's important that you are aware of the tricks used by these insurance companies and their adjusters, which is outlined below. These tactics highlight the importance of seeking adequate legal representation, or at least the very least a consultation, before you settle a serious accident or injury claim.
The Insurance Companies' Common Tactics and Tricks
1. Pretending like they are your friend and acting like they really care
Clients often give us feedback that insurance companies are much more pleasant before they get us involved. Well, of course! They are really nice when they offer you just a fraction of what they truly owe you, but not so nice when you hire a lawyer, who is aware of their tactics and tricks and will secure you the compensation you deserve.
As is obvious from their motive, the adjusters who are representing the person who was at fault for the accident are not your friend. They don't really care about you and your treatment. They are simply trying to get information out of you that they can then use against you to minimize your claim and pay the least amount possible. This tactic is to dissuade you from hiring a lawyer and seeking the legal assistance you need.
2. Arguing about and disputing your medical treatment
Many insurance adjusters seem like they suddenly got a medical degree when beginning to talk about your injuries. Often they will recommend treatment that is much less than what is recommended by your doctor, the expert who actually saw you and evaluated you. Furthermore, they attempt to make you feel dumb or guilty for seeking medical treatment with claims such as, "I'm surprised your still treating" or "usually people are better by now."
Don't put up with it.
3. Arguing about and disputing medical charges
Along with their new medical degree, they also become experts in the costs of medical procedures. Often they will complain that your bills are too high and the cost of your medical treatment is just too much. While everyone can agree that medical care is expensive, it is not your fault you are having to seek care and endure treatment. It is their insured's fault, and you should not be penalized for that. After all, that is why people buy insurance.
4. Constant delay
The insurance companies know this is an inconvenience for you and that you want to get it over with as soon as possible. They know you have missed work and they know the medical bills are piling in. Their idea is that the more they delay, the more pressure you are under to get the claim settled and get some cash. They use this financial leverage to get you to settle for less than you deserve.
5. Requesting unimportant information
This is just another delay tactics. By forcing you to search for every little bit of information, even if it is meaningless, they are adding unnecessary delay to your claim.
6. Misrepresenting the insurance that is available
Sometimes, these insurance companies can misrepresent the amount of insurance that is available in a claim. In certain instances, some insurance policies are "stacked", and there could be more coverage there than you realize.
How does an adjuster decide what to offer on a claim?
As was said in the previous section, insurance adjusters are trained to handle this cases in a certain way, so they have a method for how they evaluate these claims and determine their offers. Their ultimate goal is to avoid lawsuit and a trial. However, since that is always a potential outcome, they must always consider that scenario in evaluating claims. They consider factors that potential juries would look at in determining what a claim is worth. These factors are:
- Expenses (i.e. medical bills) of the past and the future
- Loss of income or loss of ability to earn a living
- “Pain and suffering” (i.e. physical and mental anguish that was caused because of an injury)
- Pre-existing conditions
Expenses like medical bills and loss of income are pretty easy to determine because they have hard numbers to them. Other damages though, like “pain and suffering” are more subjective and more difficult to determine.
Of course, two other major factors the insurance adjusters consider are the policy limits of the insured and the strength or weakness of the claimant’s case.
The policy limit is the top amount that an insurance company will pay. They are never going to pay more than the policy limit. For example, if the driver who was at-fault had a policy of $100,000 in liability coverage and your medical bills were $150,000, the most the insurance company will ever pay in connection with that incident is $100,000.
The Strength or Weakness of the Claimant’s Case
This may seem obvious, but if the claimant has a really strong case (i.e. both liability and damages are clear), the insurance adjuster is going to be more willing to settle and more likely to offer a larger settlement because if the case ends of going to trial, the claimant’s victory will almost be certain. On the other hand, if the case is weak, the adjuster is likely to offer much less.
Now that you have an understanding of how these insurance companies and the adjusters work and the motivation behind what they do, you can use that information to your advantage to negotiate the best settlement for your case. There are a few things you should consider:
- Document everything, make sure you have clear evidence of who was at fault, and make sure you have clear evidence of the extent of your injuries.
You should collect the other persons insurance information, take photographs of both of the vehicles, obtain the accident report, document a timeline of what happened, collect your medical records, collect from your doctor any information documenting future medical care and the cost of that care if you are going to need it, collect any other statements or bills paid or owed and request documentation from work showing the lost wages. Obtaining all of this information and having hard evidence will be key in leveraging your spot in negotiations.
- Consider sending a formal demand letter.
A demand letter is a letter that you send to the at-fault’s insurance company where you lay out your side of the case, why their insured is at-fault, and all of the damages you have sustained because of their insured’s mistake or negligence. Finally, you state what you amount of money you desire in order to settle the case. Once you send the demand letter, you will begin negotiations with the insurance adjuster. Remember, negotiations need adequate room for both parties to move in order to feel as though it is a fair settlement. Be realistic, but ideally your number needs to start out higher than what you are actually willing to accept.
WARNING: Do not give the liability (at-fault) insurance carrier a recorded statement or a medical authorization. If it is your own insurance company, you will probably have to give that recorded statement.