Dealing with a low-ball insurance settlement offer

A serious motor vehicle accident can leave you unable to work and dealing with an ever-increasing stack of medical bills. The average person working in Arkansas probably doesn't have several months' worth of living expenses saved for immediate use. You may have funds, but they're probably locked up in a retirement account with penalties and taxes for early withdrawal, and you may feel like you're at the mercy of the insurance companies handling your claim.

The insurance companies know that you're under financial stress, and they may try to use that fact against you. Many will wait for days or even weeks before addressing your claim. At that point, you're already getting bills for your medical care.

Maybe you've maxed out your credit cards, just trying to cover household expenses. So when they offer you a settlement, you're likely to jump at the offer. Don't rush into signing or agreeing to anything. You need to take some time to consider.

Insurance companies routinely make low first offers

Knowing that you're likely in a financial bind, your insurance company may offer you well below what you may deserve for your injuries and other losses. Why would they do that? It's simple. They want to reduce the financial liability involved in your claim. If you settle for a low amount, they're off the hook legally and financially. The less they pay out, the more the company profits in the long run.

Many people, unaware that insurance companies aren't operating in the best interest of policy holders who have filed a claim, assume that the first offer is likely the only offer. In reality, you have the right to refuse an offer. How do you determine if countering or refusing an offer is the best move?

Look at the long-term impact of your losses

There are immediate expenses that you need to deal with, undoubtedly. However, injuries and property damage can have longer-term implications for many families. Will you be able to return to work? Will your income be limited by your injuries? Do you require ongoing care to fully recover from the crash? Take the time to figure out how much you will continue to need in the future, as well as what you already need at this current time.

If the settlement isn't enough to cover all your losses and ongoing expenses related to the accident, then you may need to consider rejecting that first offer. Doing so can be a nerve-wracking experience, but it can also be empowering. More importantly, it could lead to a better offer, one that will actually cover your medical bills, lost wages and other expenses associated with your car crash.

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Dodds, Kidd, Ryan & Rowan
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