Top 5 Reasons Insurance Companies Lowball Insurance Settlement Offers
If there is one thing you need to know about insurance companies it’s that they aren’t in business to pay out fair settlements. Their priority is their bottom line, not their clients and certainly not the person injured by one of their clients. If you were injured because of the negligence of another such as in a car accident, you likely received a call from the at-fault insurer shortly after the accident claim, to ask questions that will benefit them and/or to make a lowball settlement offer. It is important to seek legal guidance from a personal injury lawyer before speaking to an insurance adjuster and definitely before accepting an insurance settlement offer.
Top 5 Reasons Insurance Companies Lowball Insurance Settlement Offers
Here are the top 5 reasons insurance companies lowball insurance settlement offers:
- To protect their bottom line
The number one reason that insurance companies make settlement offers well below the true value of your claim is to protect their bottom line. They couldn’t care less about what is fair or making sure that your losses are covered. Their business model is based on collecting insurance premiums and either denying or making lowball insurance settlement offers that help them keep their profits high. The more settlements they get approved that are below the fair value of a claim, the higher their profits.
- The settlement offer was calculated by software
If you were on the receiving end of a phone call with a lowball settlement offer by an insurance adjuster right after your accident was reported, there is a good chance the sum was calculated by an algorithm before they even had all the facts about your accident. While insurance companies have a legal duty to consider each claim fully and in good faith, large insurers receive so many claims each day that they have come to rely on software as part of a “Deny First, Defend Later” strategy that benefits them greatly. While the software is used to create an estimate based on similar claims, your case may have unique factors that the software is unable to consider. This can lead to outright denials and serious lowball offers.
- They are hoping you will accept the low settlement offer because many do
Insurance companies have a lot of success with their initial lowball settlement offers because many people are stressed after an accident and do not understand their legal rights or the true value of their claim. They are hoping that you will be one of these people. The best thing you can do is to decline their offer and speak to a local injury lawyer who can calculate the true value of your claim.
- Once you accept an offer you lose your right to sue them
Once you have accepted a settlement, you lose your right to sue the insurer later when you realize the true losses you have endured from the accident. The reason is because of something called a “release agreement.” The sooner the at-fault insurer can get a claimant to accept a lowball offer, the better it is for them. In Washington State, claimants have three years from the date of their accident to file an injury claim. A major reason for this is to allow time for the injured person to complete medical treatments stemming from the injury, which gives them a more complete picture of their damages.
- They don’t think you’ll hire a lawyer
When insurance adjusters make a lowball settlement offer, they are banking on you not knowing the true value of your claim or on hiring a lawyer who will fight back. They assume that you will be one of the many who accepts their initial or subsequent offers without putting up much of a fight. When you hire a car accident lawyer, it sends a clear message to the insurance company that you are going to insist on a full and fair settlement.
Seek the help of a car accident attorney
If you or a loved one was injured in a collision because of the negligence of another, contact a personal injury lawyer to discuss your legal rights. Let an experienced car accident attorney fight for the full compensation that you deserve. It is not uncommon to receive a settlement from the insurance company that is five to ten times larger with the help of a lawyer. Call the personal injury lawyers at Tario & Associates, P.S. in Bellingham, WA today for a FREE consultation! We have been representing residents of Whatcom County, Skagit County, Island County and Snohomish County since 1979. You will pay nothing up front and no attorney fees at all unless we recover damages for you!
