You’ve taken the time to craft a thorough, well-organized, well-documented demand letter. You used every possible resource to make your claim as strong as it can be. So what happens when the insurance adjuster receives your letter, reads through it, and calls you to begin negotiating a settlement?
Negotiating a personal injury settlement isn’t quite the same as haggling at a yard sale or bargaining with a car dealership salesperson. While some of the same negotiating techniques work, others fall flat in this context. Going into negotiations unprepared could mean leaving hundreds or thousands of dollars on the table. To get your insurance adjuster’s respect and full attention, you have to show that you know what you’re doing. Before your negotiations begin, arm yourself with these tips for success from our award-wining lawyers. Plus, read on to learn the real secret to negotiating a settlement.
1. Don’t Speak First
The insurance adjuster will likely ask you – in more complex terminology, of course – how much you want. Most people without legal experience will blurt out a number. That’s exactly what the insurance adjuster wants you to do. From there, the adjuster will certainly negotiate down. Suddenly the number you were willing to accept is cut in half, and the adjuster is telling you that they really can’t go any higher. It’s this amount or nothing.
A little-known secret is that chula vista attorneys like ours never want to be the first one to throw out a number. Just as you didn’t include a number in your demand package, don’t volunteer one to the adjuster, your opponent in the bargaining game. When asked, remind the adjuster that it’s his or her job to evaluate the case, and ask them what they think your claim is worth.
2. Go into Negotiations with a Number in Mind
Remember all that time you spent considering claim value? You might have been surprised that after calculating the value of your claim, and particularly your non-economic damages like pain and suffering, you never had the opportunity to include it in your demand letter.
Though the insurance company will only respect losses that you can document, the adjuster is a human being. He or she knows that you have non-economic losses, and that they warrant compensation, even though it’s in the insurance company’s best interests not to compensate you fully. The medical narrative you included in your demand letter painted a picture of how much pain and suffering you experienced. The adjuster got to see how many uncomfortable or downright painful medical tests and procedures you had to undergo and how long your injuries caused you substantial enough pain to require a doctor’s care. If you needed physical therapy, he or she was able to understand that your injuries impaired your physical abilities. Any prescription medications, like painkillers, illustrate the seriousness of your discomfort to the adjuster.
Both you and the insurance adjuster know that the value of your claim exceeds the amount of your economic damages. That’s why it’s always helpful to go into negotiations with that complete claim value in mind. Your insurance adjuster will never offer you more money than you ask for, so keep your calculations in mind as you negotiate, and always start high.
Suppose the insurance adjuster working on your claim won’t budge on the issue of naming a number first. You’re at a stalemate, and that’s not helping your case. If you wait too long and end up approaching the statute of limitations, you’ll have to file a lawsuit or end up with nothing. Lawsuits are so expensive to succeed in that you’d have to spend your personal money to handle one yourself, not to mention they’re so much more complicated than claims that you really do need a lawyer. (And if you’re too close to statute, no lawyer will want to take your case, anyway, because there simply won’t be adequate time to prepare.)
If you do have to throw out a number first, think back to that claim value amount you calculated. Make sure you included every economic and non-economic loss when figuring out that number. Of course we’d all rather get more money than less money, but is the number you calculated something that you will realistically be happy with?
If so, multiply it by two – or more. Then use this number to open the negotiations.
3. Always Ask for More Than You Want
A basic rule of all negotiations is to start higher (or lower) than the amount you really want to pay. Think about the process of buying a car. You are trying to get the best deal, so you start by naming a price lower than you really expect to have to pay. The salesperson counters with an offer higher than the price you named (and then he or she expects to get), but lower than any price he or she had previously stated. As you go back-and-forth, you approach a middle ground. The basic idea stays the same, but the roles shift slightly in the personal injury scenario. Instead of seeking the lowest-priced deal, you’re looking for the highest-value settlement.
4. Adjust Your Haggling Strategy
A major difference between your personal injury claim and a car sales situation is that your options are limited. If you don’t like a salesperson’s attitude or the deal they are trying to get you to accept, there is always another car dealership for you to visit. You’re not locked into doing business with this person, and he or she knows it – which might make the salesperson more willing to cooperate with you and negotiate fairly. In a personal injury claim, you don’t have such freedom. If your preferred bargaining strategy hinges on threatening to take your business elsewhere, this negotiation will force you out of your comfort zone.
5. Never Reveal Your Bottom Line
Remember when we said earlier that the insurance adjuster is your adversary? Now you finally get to see that relationship in action. If you’re naturally a very straight-to-the-point person who doesn’t like playing the game of negotiating, you may be tempted to tell the insurance adjuster simply, “this is my bottom line.”
Don’t do it.
Though you’re not in the same physical space, you and the insurance adjuster are on opposite sides of the bargaining table. Sure, the adjuster might seem like they feel the same way about the process. Just as he or she did at the start of your claim, the adjuster is again trying to gain your trust. If the adjuster didn’t like negotiating – or, more importantly, wasn’t good at doing it for the benefit of the insurance company – he or she would find a different line of work.
So don’t let your guard down just because the insurance adjuster tells you that the company would like to resolve the claim as quickly as possible and that giving them your bottom-line number will speed up the process. It’s just one more trick. From your lowest acceptable number, the adjuster will continue negotiating down. It’s too late to change your mind and up the amount of money you’d accept. You’ve already given up your leverage.