What is a Reasonable Settlement Offer in an Injury Case?

The purpose of a personal injury case is to seek financial compensation that covers all the medical bills and personal losses associated with an accident. This is usually accomplished via negotiations with your lawyer and the insurance company and involves making offers and counteroffers to come to an amount that makes sense to you. So, just what is a reasonable settlement offer in an injury case?

*This information is not provided in the course of an attorney-client relationship and is not intended to constitute legal advice or to substitute for obtaining legal advice from an attorney licensed in the appropriate jurisdiction. Readers should not act upon any information without first consulting their own legal counsel.

When looking at what makes for a good settlement offer, you’ll see that it depends on the factors of the accident, economic damages, mental suffering, and medical expenses. These are part of why it’s difficult to come up with a definite amount when trying to figure out what is a good settlement amount. Here’s a look at what is a good settlement offer, and what goes into coming to the number you and your lawyer find acceptable.

The Three Types of Damages Factored Into a Personal Injury Settlement

A personal injury claim has three types of damages. They are:

• Economic
• Noneconomic
• Punitive

Economic damages include anything that has tangible value. They may include medical expenses, loss of income, property damage, the cost of living with a disability for a short time or for the long term, and personal care. If someone was killed in a personal injury accident, the costs of the funeral are also included.

Noneconomic damages are intangible, and assigning a dollar amount to them is difficult. These types of damages include pain and suffering, mental distress, loss of companionship, and a loss of ability to enjoy life. It’s more difficult to figure out how much noneconomic damage there has been due to the fact that most people don’t have a way to value emotional pain the same way they can put a value on a tangible item or service.

Punitive damages may be included when the act causing the injury was especially egregious or reprehensible. They’re intended to punish the responsible party and hopefully deter others from engaging in the same activity going forward.

The Factors That Are Considered When Determining What Is a Good Settlement Amount

Answering the question of “what is a good settlement amount?” starts with taking a look at the factors involved in the accident. Some of the factors may include:

• Accident type
• Injury
• Injury severity
• Economic impact of injury
• Emotional impact of injury
• Length of time needed for injuries to heal
• Short- and long-term medical treatment
• State laws.

Personal injury accidents can result in injuries that range in severity from mild to fatal, and you can take legal action as long as you have damages that have economic value. For example, if you slipped and fell in a store, had a mild concussion that affected your ability to function for a short period of time, you may have a personal injury claim because you were unable to experience your normal day-to-day life as a result. Or if the concussion was severe enough to cause a traumatic brain injury that required months or years of rehabilitation to get back to a functional state, you most definitely have a personal injury claim as you’ll need money to cover your ongoing medical expenses.

Using a Settlement Calculator

Your lawyer may use what is known as a personal injury calculator, or formula, that takes all of these factors into account to determine what is a reasonable settlement offer in an injury case. You can use the calculator on your own to get an idea of what is a good settlement amount, but this is something that really needs to be done by a lawyer to get the best possible outcome. The following formula is the one most commonly used to determine what is a good settlement amount:

Medical Expenses

Gather all of the medical bills that you received from medical providers, regardless of whether or not you paid them out of pocket. Add all of the bills together and write down the total amount.

Property Damage

If you had a vehicle that was damaged or declared a loss by the auto insurance company, write down the total cost of repairs or replacement value of the vehicle.

Lost Earnings

Did you miss out on work or lose your job as the result of your injuries? Calculate the amount of money you would have earned had you not been injured, and enter it into the line items.

Future Lost Income

Any future income you might lose as the result of taking time off for medical care for accident injuries can be entered into the calculator. Estimate how much income you might lose for the hours you’re away from work.

Total the Amounts Together

Add all of the amounts together to come to a final number. However, this isn’t the amount you’ll ask for in your personal injury case. The total amount has to be put through a multiplier to include pain and suffering.

Using the Multiplier for Pain and Suffering

The multiplier is used to determine what is a good settlement amount for pain and suffering. A lower number is applied to less serious injuries. A higher number is used for very serious injuries and death. Multiply the total dollar according to the severity of the injuries.

Another formula to determine a good settlement amount is called the per diem method. The per diem method calculates how much money was spent every day on personal and medical needs during the physical and mental recovery period. It’s not used as much as the multiplier method, but can be useful in a personal injury case.

While you can get an idea of what is a reasonable settlement offer in an injury case by using the formula, it’s best to let a lawyer do this as part of the settlement offer. The lawyer has a good idea of how much to ask for in the initial settlement offer in order to help you cover your medical costs and pain and suffering.

Texas Comparative Negligence Rule

The state of Texas has a rule known as the comparative negligence rule. (Different states have different approaches to comparative negligence. Texas is referred to as a modified comparative negligence state where the plaintiff can still recover even when they are found to be up to 50% responsible. See below for more detail.) This rule assigns a percentage of the blame for an accident to both parties, from 0% to 100%. If you had nothing to do with the accident, the person who caused the event will be assigned 100% of the blame. If your actions played a part in the accident, you’ll be assigned a percentage of the blame. This rule also may affect how much you receive in a settlement offer, as the insurance company can reduce their offer by your percentage of fault. If your case goes to court, the percentage of blame will be deducted from the total award. The rule also says that someone who has 51% or more responsibility for an accident can’t make a personal injury claim.

For example, you’ve determined that your settlement is worth $75,000, but you have 10% of the blame assigned to you. You would receive $67,500 for your settlement. However, you may feel that the percentage of the blame is in error, and you had nothing to do with the cause of the accident. A personal injury attorney can help by looking at the evidence and determining whether it’s possible to lower your fault percentage.

Insurance Policy Limits and How They Affect a Settlement Offer

Most personal injury claims are paid by the insurance company of the liable party. How much coverage the liable party has can play a role in how much you get in the settlement offer. Texas requires a liability coverage policy to have a minimum of $30,000 in coverage per person injured in an accident up to a total of $60,000 per accident, and $25,000 in coverage for property damage. The minimum amount of $30,000 can seem adequate but may be quickly used up by the medical bills for serious injuries. If more than one party is involved in the accident, the chances of a good settlement are higher. How much money you can recover ultimately depends on the circumstances of the accident and the insurance policies carried by the liable party or parties.

Contact us at Terry Bryant Accident & Injury Law to Learn About Your Options for a Personal Injury Settlement

After an accident has happened and you’ve sought medical attention for your injuries, give us a call now at (713) 973-8888 or toll-free 1 (800) 444-5000 to schedule a free, confidential consultation. Our team of personal injury lawyers is available to review your case and give you advice on the best way to proceed. We’ll help you with the necessary paperwork, collect evidence to help support your claim, and represent your interests at all times to ensure fair treatment.

Our team has decades of experience and have handled thousands of personal injury cases on behalf of accident victims. You don’t have to deal with the pressure of the insurance adjusters and their lowball offers when you retain us for help with your medical and personal needs after an accident.