How Do Lawyers Negotiate Settlements: A Guide

How Do Lawyers Negotiate Settlements

You may be wondering what goes into the settlement process and just how lawyers negotiate settlements. When you are harmed by someone else’s negligence, like in a car accident, you may decide to seek compensation through a personal injury claim. While the litigation process can bring just compensation and help you resolve an insurance claim, many people may opt for settlement negotiations to resolve their case without having to present evidence or pay for a personal injury attorney.

While settlement negotiation can be done effectively, people who proceed without an attorney and without understanding the whole case may end up leaving the negotiation process without what they need to pay bills and cover the potentially catastrophic injuries that they face. This article will outline why personal injury attorneys can benefit a case, especially in a settlement negotiation.

Do I Need a Personal Injury Attorney?

An attorney can help resolve insurance company negotiations or litigation because insurance companies are often fully funded and supplied with top-notch attorneys from a big law firm, such as  Leitner Varughese Warywoda PLLC,  which can make the process very difficult and frustrating for those who do not have attorneys. A personal injury lawyer will be able to understand the legal action, and an experienced attorney will be able to provide an accurate evaluation of your case to determine what is the best settlement offer.

Attorneys are also able to bring the necessary and valuable skills to the negotiation process that can help accident victims request compensation from the at-fault party and receive fair claims under their insurance policy. This can result in higher settlements and is in the best interest of the injured party.

Cost of Personal Injury Lawyers

For many, the cost of hiring an attorney will feel like too much to justify and can be in some circumstances. However, most attorneys who practice personal injury will be able to provide a free consultation to hear about the accident and evaluate the accident-related losses. This can give you a better understanding of your case and can help you have a successful negotiation strategy even if you do not hire an attorney.

Additionally, personal injury attorneys will take most cases on a contingency plan, meaning that they will only be paid if you win or settle your case, and the payment is built into and accounted for the damages requested. This is helpful in two ways. First, this means that the attorney will only offer to take the case if they believe they can win or achieve a favorable settlement because they would not get paid for their work otherwise.

Second, this often means that you will not have to pay any money to the attorney directly, which can significantly lessen the burden. With this in mind, and combined with the skills added below, it is clear that having a personal injury attorney to represent will likely add value to your case, rather than detract from it.

The Key Players

To better understand how settlement negotiation works, it can be helpful to outline the different players in the negotiation.

Liable Party

The liable parties are the people who are at fault for the accident and responsible for the injuries sustained. Liability means that the actions that the person took or did not take caused injuries to the other person. Most of the time, there is some shared liability, but occasionally there is only one person responsible.

Injured Party

The injured party is the person injured by someone else’s actions in a personal injury case. Like liability, this can be split anywhere from 50% per party to 100% for one party and 0% for the other party. The injured party will be the plaintiff in the case.

Insurance Company and Insurance Adjuster

There will be insurance adjusters from the insurance company for the at-fault party present. An insurance adjuster is a person who evaluates and pays out a claim under the insurance policy limits and is dependent on insurance coverage. In most cases, you will be dealing with the insurance company that is responsible for liability coverage.

Personal Injury Lawyer

As mentioned above, you will likely also encounter personal injury attorneys at the negotiating table. Lawyers negotiate settlements on behalf of their clients. Any settlement agreement that comes out of the negotiations will likely require the liable party to pay the injured party’s medical bills and additional expenses.

Settlement Negotiation Process

While the entire settlement procedure may seem daunting, the process is fairly straightforward. When working with an attorney and the insurance company on a personal injury case, the lawyer will often gather the appropriate evidence and determine the best amount for the initial settlement request. This request will be sent in a demand letter to the insurance companies that are responsible and will often begin at the maximum policy limit allowed under any applicable insurance policies.

Once they receive the demand letter, the insurance company will often they will respond with a lower settlement offer, because they will rarely accept the maximum amount. Demand letters may be sent back and forth during the process of negotiating settlements, and the exact parameters will be determined throughout negotiating a settlement. The attorney and the insurance company will trade offers until they reach a settlement amount they can both agree on. Then they will have a settlement agreement.

The Key Elements of a Fair Settlement in a Personal Injury Case

Personal injury attorneys can work to get the best possible settlement for their clients by relying on several key elements and demonstrating more evidence of the liability and damages suffered.


Because liability determines the amount each party is responsible for, an insurance company will often try and claim that the liability they have determined does not match the settlement offer from the injured party. To get a higher settlement offer for a client, personal injury attorneys will often present more evidence to continue to shift the liability to the other party. By presenting additional evidence, the insurance company will have a better understanding of the case and the liability and will present higher settlements that match the determinations.

Economic Damages

Economic damages are the costs to the injured party because of the actions. Several costs may be included in this.

Medical Treatment

The injured party will likely seek reimbursement or payment for medical bills, including any medical devices or other medical expenses that are a part of their treatment plan. The exact amount will depend on many factors, such as how much was already covered by health insurance while also accounting for the rise in costs of the insurance.

Lost Wages

Lost wages may also be part of the economic damages that are part of a settlement. This is particularly true when the injury has caused the party to not be able to work full-time or at all. Again, the amount will depend on several factors, but the more the injury impacts the ability to work, the higher settlements will be offered.

Non-Economic Damages

A party may ask for additional non-economic damages as part of a settlement amount. This can include damages for the emotional distress caused by the injury. These damages can be particularly high in catastrophic injury cases where the whole life of the person is dramatically changed.

Final Thoughts

Insurers are often very skilled in negotiation and will have an expert legal team on their side to help limit their potential payout. To protect your interests, you must have an attorney on your side who has the necessary skills and understands how to handle a negotiation. With these factors in mind, personal injury attorneys can help you resolve your case effectively and with the best option available.

To learn more about settlements, negotiations, and more, contact ADR Times!

Emily Holland
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