What Is a Traffic Crash Settlement Agreement
A traffic accident settlement agreement is a legal contract that resolves an accident claim and compensates accident victims for damages. It usually comes after a negotiation phase with an insurance provider or the party responsible for the incidents of the traffic accident.
The agreement is typically a legally enforceable contract with the at-fault party of the accident, wherein they agree to pay for damages in the case (whatever they may be presumed to be) and the claimant agrees to be satisfied with that compensation. Most traffic accident settlement agreements also include a full release , which is a legal document stating the claimant cannot pursue further damages from the at-fault party for issues that may arise out of the same incident.
Traffic accident settlement agreements are usually reserved for circumstances where the parties agree there has been fault on the part of one or more, and the traffic accident not only leaves the victim with damages to repair, but also often ends the ability to collect any potential losses they may be entitled to later on.
Considering a traffic accident settlement agreement can save each party time and money, and formalizes the process of negotiating terms.
The Essentials of a Settlement Agreement
When it comes to settlement agreements, key components must be included in order to bear the binding power that is expected. In essence, a settlement agreement functions much like a contract, and the courts will likely enforce one that complies with the laws of your state.
Under most traffic accident settlement agreements, the following elements must be outlined:
The Ability of Parties to Sue For settlement agreements to be considered binding under state law, the parties entering into the agreement must be of sound mind and must have had the ability to sue. Suppose a driver were drinking at the time of a serious accident and the injuries she suffered did not affect her ability to make rational decisions. In this case, her settlement agreement would likely be binding.
Legal Competence of Parties to Sue Under the same example, if the driver had been intoxicated to the point where she could not make rational decisions because of the alcohol she consumed, her traffic accident attorney may not be able to negotiate a binding settlement agreement releases the alcohol vendor and driver of all liability stemming from the plaintiff’s accident. (such as examples related to dram shop laws and wrongful death claims)
Parties’ Claims When people review the terms of traffic accident settlement agreements, the language often indicates that the parties exchanged information about their respective claims and that these claims may be resolved with the terms of the agreement. Although term sheets and correspondence between attorneys can be made part of the record in an attempt to prove that negotiations took place before the agreement was negotiated, an argument could be made that any discussions regarding the claims may be inadmissible.
Lawyer Fees In a traffic accident settlement agreement, attorneys’ fees are generally negotiable. Whether the plaintiff is paying the defense lawyers’ fees or the defendant is paying the plaintiff’s legal fees in the case of a defense verdict, adds to the complexity of an agreement. In most cases, approximately 30 percent of the recovery will be given to the attorney.
As with any legal arrangement, traffic accident settlement agreements are best drafted by an experienced traffic accident attorney.
How To Get to a Settlement Agreement
After the insurance company acknowledges fault, they will often make a demand for a settlement. After I’ve put you in contact with my office manager, she will send out a letter of representation to the other party’s insurance attorney (if they have one) and the other party’s insurance company once we’re ready to begin settling. We get this out as quickly as possible so that you can get an accurate picture of the costs of your accidents. We need the adjuster at the other insurance company to notify the medical providers of our involvement so that they will not continue to call you about your bills, especially if you have health insurance and need to use it for other purposes like your health. Once we’ve received the bills, we’ll send you a list of our billing and what we expect your settlement amount to be. We’ll discuss with you what specifics you want us to ask for in the case of a settlement, how much time you want the adjuster to have to respond to the demand, and how long you want to wait before filing suit if they don’t agree to your terms. After we receive a response, we’ll be able to discuss with you how far we believe the insurance company may be willing to go. Normally, the insurance company will not consider punitive damages. Normally damages that can be discussed with the insurance company are: property damage/wages lost due to missed work, pain and suffering, future costs of care, costs of rehabilitation, costs of medical devices and impacts to lifestyle. If this is a question that is discussed, we’ll let you know and guide you through it. From there we should be able to discuss how far the other party has offered and how we should proceed. Once we determine that we are not able to settle speedily (from 1-6 months on average), we can file suit. The process for that as well is fairly simple, as I determine the defendants involved, and my office will draft up the suit itself and take care of filing it and getting it served upon the various defendants. Usually, if you are offered a fair settlement, your case can be over after 6 months to 2 years. However, there are cases that could go longer, depending on the other parties involved, the depth of your injuries, and more. My practice involves going to trial, and I’m quite efficient in doing it. With my extensive experience, I am usually able to settle people out of court without any hassle, but if I need to go to trial, I will.
Issues Affecting the Settlement Amount
Both the at-fault driver’s and your insurance policies may have coverage to handle the damages. Your health insurance coverage may be liable to pay your medical bills, though there are restrictions and limitations and some insurance companies deny their obligation. If the at-fault driver has no insurance or his or her insurance company denies coverage, then you may have to turn to your own car insurance policy for coverage. This is very important information to acquire from your car insurance agent or attorney.
You also need to consider your medical bills. Comprehensive medical records and documentation are critical to your case. Medical expenses generally include physical therapy, prescriptions, doctor’s visits and surgeries. In addition to these costs, there are the costs of medical care in the future, which could be a huge expense in your settlement negotiation or litigation. Further, you may have lost time from work that needs to be compensated.
Pain and suffering is also a factor in the settlement amount. Pain and suffering generally includes emotional, mental and physical suffering. There are many considerations when calculating pain and suffering, including how much of the injury remains, and whether there are future implications and expenses. The plaintiff is responsible to prove pain and suffering. Juries are generally skeptical regarding pain and suffering and the challenges of "proving" pain and suffering are well known to attorneys. Pain and suffering is emotionally charged, and can be both high and low in regard to damages.
Representation in the Settlement Negotiation Process
In the realm of traffic accidents, the process of arriving at a settlement can be labyrinthine, but the presence of a legal representative can demystify the path. Attorneys serve not merely as advocates, but also as counselors who possess a clear understanding of the law and the intricacies of the negotiation process. This enables them to navigate the complexities that often obscure the path to a just settlement.
When they enlist an attorney to handle their case, traffic accident victims gain a partner who is dedicated to securing their best interests. The attorney’s responsibilities encompass collecting pertinent information related to the accident, including medical reports, police documentation, witness accounts, and any other details relevant to the case. Through a thorough review of these documents, and by applying their knowledge of the law, an attorney is able to craft a strategy for negotiating a settlement that is both fair and just, even when faced with unreasonable insurance company settlement offers.
The role of an attorney is to ensure that all damages sustained by the victim are adequately compensated. This includes current and future medical expenses , lost wages due to time missed from work for medical reasons, property damages and loss, pain and suffering—the list goes on. The attorney’s task is to fight for the client’s rights and secure a settlement that encompasses all of the damages suffered by the victim.
Negotiating a settlement without an attorney is a risky proposition. A settlement offer from an insurance company typically comes with a very short timeframe to review the offer and accept or reject it. Failure to respond to the deal in time may result in the insurer keeping the offer open for a few weeks, but if you fail to accept the offer in the timeframe stipulated by the insurance company, the offer will be revoked. By hiring an attorney, you ensure that all future correspondence with the insurance company is handled by the attorney’s office. This allows you to devote your efforts to healing while the attorney handles the negotiations and settlement at a pace that is comfortable for you.
Pitfalls in a Settlement Agreement
When deciding on whether to settle a claim, whether it’s with an insurance company or otherwise, there are some common mistakes that many make. The most important thing is for one who is injured to not agree to a settlement until they fully understand it and are completely confident that they are making the correct decision.
One of the most important things to make sure of is that you have completed your medical treatment. A settlement will almost always be based on whether treatment was completed. That said, there are sometimes exceptions and occasionally a settlement needs to happen before treatment is completed. In such a case, some type of agreement needs to be reached that addresses adjustment if new medical bills arrive after a settlement agreement is signed. Unfortunately, some individuals may settle their claim without having any type of understanding of how an insurance company values a traffic accident case. The value of a settlement can vary widely from case to case and depends on a variety of factors. Again, this is something to make sure you are aware of before entering into an agreement. Be sure to talk to an attorney and have them review the language of the settlement agreement. All too often, individuals sign an agreement without fully understanding some of the legal language. This can lead to unexpected hits down the line. For example, you should be aware that if you are an employee, a settlement generally may not be null and void if you cannot return to work. You cannot in all likelihood make a claim against a liable driver for lost wages if you are already employed when involved in a traffic accident.
When You Might Want Your Case Litigated
For some, the settlement process can be long and drawn out. Some people do not feel comfortable settling their case because they appear to have potential liability issues. This means that either the facts are not in your favor, or there is an unknown circumstance which could create liability that you don’t know about. While in most cases we recommend that people settle their cases, the settlement process can be equally or more time-consuming than litigation.
There are many instances where a person is strongly rejected by an insurance company and the attorney feels they cannot get higher than their last offer, thus litigation would make sense. If liability rests against two parties in a rear end collision, it is likely that the plaintiff will need testimony from an expert witness to corroborate the facts. In a case where an underinsured motorist is responsible for the collision due to lane change negligence , there may be a "no contact" provision in the policy requiring corroborating testimony from an accident reconstruction expert.
The same situation arises in cases of wrongful arrest, where the plaintiff must establish a malicious intent on the part of a police officer. The one feature of wrongful arrest cases that makes litigation so time-consuming for plaintiffs (and medical malpractice for that matter) is the necessity for a demand for a statutory claim letter before litigation can begin. This provides an almost inevitable further delay for 90 days of further investigation by the police department. There are times the police officers deny liability and the department refuses to settle or even reject the notice. At this point, the plaintiff must engage an attorney skilled in taking depositions.
All these factors help dissuade a plaintiff from pursuing litigation where there may be an opportunity to settle the case. Thus we can say that if defendants are adamant in denying liability, then an opportunity to settle or continue with litigation may be in order.