Negotiate Higher Insurance Settlements Guide

An insurance claim can be overwhelming. In fact, you have experienced a stressful event. Now, you have to deal with paperwork. It is a difficult situation for anyone. The first offer by an insurance company may appear to be the final one. Often, however, it is only a starting point. The key to this is learning how to negotiate higher insurance settlements. Ultimately, it empowers you to always get the fair compensation that you need.

This guide is your roadmap. We will guide you on each and every step. For example, you will know what adjusters are looking for. You will also find out how to make a strong case. As a result, you can come to the negotiation table with confidence. Let’s make sure that you are not leaving money on the table.

Why a First Settlement Offer Is Rarely the Best

Insurance companies are businesses. Therefore, their ultimate aim is to save their bottom line. For this reason, their initial settlement offer is often low. They do this to test the waters to see if you will get accepted by them on the fast.

Many people do. They are fatigued and just want it to be over. Adjusters know this and of course use it to their advantage. But you can be different. By being prepared you can improve your outcome to a great extent. It has to begin with understanding their game.

Part 1: Understanding the Claims Process for a Higher Settlement

Before you can hammer on a deal you need to know the field. The process of insurance claim has certain stages. Knowing them, in fact, helps you to be one step ahead. It makes a confusing process simple with a clear steps process.

Filing the Initial Claim: Step One in Your Settlement Negotiation

The moment an incident is issued, the clock commences. First, you will have to report the claim to your insurance company as soon as possible. This is what you consider to be your first official action. It gets the ball rolling.

You are supposed to give them the basic facts. For instance, this is the date, time, and a short description. Importantly, don’t admit to a fault of yours and don’t go into too much detail at this point. Instead, people should stick to the essential information. Your quest to get higher insurance settlements starts here.

The Adjuster’s Role in Your Insurance Settlement

It is soon after that an insurance adjuster will contact you. Basically, their job is to research the claim. However, they work on behalf of the insurance company. It is important to remember they are not on your side. Their main objective is to resolve its claim for the lowest amenable amount.

They will probably request that they go record a statement. You can graciously refuse this offer. Instead, offer to be a source of all information in writing. This gives you more control. This is a very important step to preparing for an insurance claim negotiation.

Why Initial Insurance Settlement Offers Are Often Low

The adjuster will give a look into your case. Then, he or she will make a settlement offer. This number is according to their own calculations. Unfortunately, these calculations usually minimize your losses.

For example, they might take cheaper parts to perform car repairs. Or, they may understate the seriousness of an injury. This is a standard tactic. Therefore, it is your job to contest their evaluation through your evidence. In fact many people find that using smarter financial defense tools can help them to spot out these lowball tactics early on.

Part 2: Building Your Case to Negotiate a Better Insurance Settlement

A successful negotiation is won before you ever speak to the adjuster. In other words, it is won during the preparation. The more evidence you have the better your position will be. For this reason, do not skip this important phase.

“By not preparing, you are preparing to fail.” – Benjamin Franklin

Document Everything for Your Settlement Negotiation

Your smartphone here is your best friend. Immediately after the incident take photos and videos. Be sure to get the scene from a number of angles.

In the case of a car accident settlement, you should take photos of both vehicles. Pictures of the license plates and the surrounding area should also be obtained. For a property damage claim, photograph all of the damaged property. Do this before you clean-up anything. This visualization proof is surely difficult to argue.

Gathering Records for a Stronger Settlement Claim

There must be a paper trail for your argument. So, you need to start a folder and gather all the things concerning your claim. This is an important step to negotiate higher insurance settlements.

This includes:

• Police reports.
• Medical bills and records.
• Receipts of any out of pocket expenses.
• Repair estimates by shops of your choice vector.
• Proof of income you lost from your employer.

Keeping these organized show that you are serious to the adjuster. Consequently, you can make use of these records to make yourself safe from claim fraud by having a verifiable history of your claim clearly.

Calculating Your Claim’s True Value for a Higher Settlement

Now it is time for math. You have to sum up all your tangible losses. These are the cost of your special damages. Luckily, they have a good dollar amount.

But what about your hurt and suffering? These are general damages. Of course, they are less easy to quantify but just as real.

Tangible vs. Intangible Losses in Your Settlement

• Tangible Losses (Special Damages): These are your actual expenses. Take medical bills and lost wages for example. Also include repair costs and rental car fees. They are easy to prove through receipts.
• Intangible Losses (General Damages): On the other hand, this refers to your physical pain. It also covers emotional distress. Things such as anxiety or loss of enjoyment of life fall here. While there are formulas that insurance companies use, you can argue for more.

One way that is commonly used is to multiply your special damages by a number (from 1.5 to 5). The multiplier is dependent of the severity of your injury. A good strategy in negotiating for higher insurance settlements is to clearly justify higher multiplier.

Part 3: The Art of the Deal: Tactics to Negotiate Higher Insurance Settlements

With your evidence prepared you can now play your part. This is the stage of insurance claim negotiation. It is a communicating and strategic dance. Your goal is, therefore, to take the lead in the dance.

Writing a Powerful Demand Letter to Start Negotiations

Your first step to take is to send a demand letter. This is a professional letter is clear in outlining your case. In essence, it is your official opening offer.

It should clearly portray the facts. Then, imagine all your damages, tangible and intangible. In addition, ensure that you attach copies of all your documentation. And finally say the total sum that you are demanding. This number should be more than your minimum acceptable number. This allows you room to bargain. For more detailed guidance, legal experts at FindLaw offer great templates for demand letters.

Key Strategies for a Better Insurance Settlement Negotiation

Once they have received your letter the real talks begin. The adjuster will contact you about it by phone. Here are some insurance adjuster tips to consider.

Above all, be polite but firm. Never get angry or emotional. Instead, try to stick to the facts of your case. Availability to always refer back to your documentation. If they do make a point, ask them to point out to you where in your policy it states that. Also, learning more about different smarter safety options before a policy purchase can make your future claims a stronger one.

How to Respond to a Lowball Settlement Offer

The adjuster will almost certainly counter with a number lower as well. However, do not let it discourage you. This is part of the process.

First have them justify their offer in writing. How did they get the number they did? Furthermore, what evidence are they not taking into account? This places the pressure back on them. Then, you can write a response. In it, you should cover their points and restate your position.

“The most important trip you might ever take in life will be a trip halfway.” – Henry Boyle

This quote is definitely true here. Negotiation is about looking for Common ground. But you have to start out from a position of strength.

The Power of Patience in a Settlement Negotiation

So insurance companies hope you are a hurry. For this reason, they may stall the process. They want to get you desperate and accept a low offer.

Be patient, that is your secret weapon. You have to show that you are not in a hurry. Let them know that you are willing to wait for a fair deal. This simple act may often result in a better settlement offer. You may always look into tactics of mastering quick payouts later on, but when you are in a negotiating situation, patience is the key.

Part 4: Negotiating Different Types of Insurance Settlements

Not all claims are the same. Therefore, the strategies that you employ will be different. The secretary depends on your type of claim. Now, let’s consider the most common of them.

How To Negotiate a Car Accident Settlement

Car accident settlements are very common. Your negotiation will be in two areas. First is the cost of repairs of replacement for your vehicle. Second, any medical expenses.

You will have to obtain your own repair estimates. Do not just accept the one from their “preferred” shop. Indeed, you have the right of choice in your repair facility. This is a very important step to negotiate higher insurance settlements for damage to the vehicle.

Don’t Forget Diminished Value in Your Settlement

If your car is repaired it lowers the car’s value when sold. This loss in value is referred to as “diminished value.” You can and should claim this as part of your settlement. Most insurers will not provide you with unless you ask. So, you would have to ask directly for it.

Negotiating a Difficult Property Damage Claim Settlement

A property damage claim can be very complicated. This could be from a fire, flood or storm. For this type of claim, you will need to produce a detailed inventory of each and every lost or damaged item.

For each one of the items, state the description. Also, the age and original cost of it. Then, under this list the replacement cost. Be as thorough as possible. This hard-core list is your own backbone in the negotiation. You can even compare market leaders to see how various companies deal with such claims, and you will have more leverage with them.

Negotiating a Complex Personal Injury Claim Settlement

A personal injury claim is the most complicated. It is not only current medical bills they’re dealing with. This also includes future medical care. Furthermore, includes your pain and suffering.

You need to be able to prove the extent of injuries that you’ve sustained. This means you have to keep detailed records from your doctors. For instance, a doctor’s appreciation of future therapy or long term effects is powerful. This is where a higher multiplier for general damages comes in. It’s also wise to understand how your policy can are used for long-term wealth growth through risk distribution in spite of a large claim.

Part 5: Getting Help to Secure a Higher Settlement

Sometimes, you just cannot do it all by yourself. The insurance company may be unreasonable. Or possibly the case is too complicated. The ability to know when to ask for help is a sign of strength and not a sign of weakness.

Hiring a Public Adjuster for Your Property Settlement

For a large property damage claim a public adjuster is a huge asset. Unlike the adjuster for the insurer company, they work for you. Moreover, they are expert in studying damages in properties.

They will take care of the whole claim process. This includes documentation and negotiation. In return, they work on some percentage of the final settlement. This means that they have incentive to get you more money. You can locate licensed professionals licensed as in licensed by the appropriate governmental agency is the one licensed in NASI (Nationale Association of Public Insurance Adjusters). It’s also a good idea to keep track of some emerging brands in the insurance world, because some brands are specializing in finding the public in contact with public adjusters.

When to Hire an Attorney for Your Injury Settlement

If your claim involves a serious injury, then you need to talk to an attorney. Legal expertise is crucial for a personal injury claim legal claim. An attorney is knowledgeable of the law. Crucially, and they know how to counter the tactics of the insurance company.

They can also hire experts. These experts can provide a testimony on your future medical needs. This can be dramatic in increasing your settlement. Thankfully, most personal injury lawyers are contingency fee lawyers. This means that you pay nothing unless they win your case. It is also important to understand government changes that might affect personal injury law and settlements.

Part 6: Finalizing Your Insurance Settlement Agreement

You have come to some sort of agreement. This is a great achievement. But you are not done yet. The final steps are critical to ensure that you get your money without any hitches.

Getting Your Final Settlement Agreement in Writing

Never, ever have a verbal agreement. Instead, insist that the settlement offer go to you in writing by the insurance company. This document should indicate the exact amount. It should also indicate what the settlement is for.

Review this document very carefully. Make sure it is consistent with your understanding. If there are any discrepancies address them immediately. The end of all our trials and tribulations was that: “don’t sign something until it is perfect.”

Understanding the Settlement Release Form

Along with the check you will receive a release form. By signing this form, you end your claim forever. In other words it is a legally binding document. In line with this statement you release the insurance company of all future liability.

“The price of greatness is responsibility.” – Winston Churchill

Signing this form is a huge responsibility. Therefore, you have to read it very, very carefully. Once you sign it, there is no going back to ask for more money. This is true even if you find out later on that you’ve sustained new injuries. This is the reason that it is so critical to get a fair settlement up front. It’s a way of increasing your family savings and ensuring your financial future.

What About Taxes on Your Insurance Settlement?

Will you have to pay taxes? The answer is: it depends. The Internal Revenue Service (IRS) has specific rules.

Generally, any settlements for personal physical injuries are not taxable. This includes: money for medical bills and emotional distress for the physical injury. However, money to compensate losses of wages is generally taxable. The portion for property damage is normally not taxed as that just makes you whole again. Nevertheless, as always, it’s always a good idea to consult a tax professional.

Conclusion: You Are in Control of Your Settlement

Learning how to negotiate a higher insurance settlement is an excellent skill. It puts the power on you and not the insurer. The end goal is really about also being prepared, persistent and professional.

You have been through enough. So, do not let an insurance company control your recovery. Use the knowledge contained in this guide to develop your case. Argue your points with some confidence. And don’t be afraid to walk off a bad offer or get an expert. Your financial well-being is the effort worth it. By mastering these skills, you can even find that there are perks that may be discovered even if the claims are far away from your home country. Now you are in position to obtain the settlement that you deserve.

Frequently Asked Questions (FAQs)