Car accidents are trying life events. An accident can be physically, financially, and emotionally draining. The mounting stress can seem impossible to handle as you worry about the severity of your injuries, missed work, and piling bills. While the physical and emotional damage sustained after an accident will take time to recover from, financial recovery can be sought immediately by pursuing a car accident settlement.
If you’ve decided to pursue a settlement, you’re likely interested in determining the average settlement value as a way of gauging what you may be able to recover. Calculating an average is no easy feat. Insurance companies use statistics to calculate averages for different accident scenarios. However, it’s rare for any two given accidents to be exactly the same and an accident hardly ever fits the profile of an “average” claim. Thus, in trying to determine what your claim may be worth, it’s important to understand how insurance companies calculate estimates and what should be included in your settlement efforts.
Is There A Formula For Calculating Car Accident Settlements?
There is no exact formula for calculating the average settlement amount for a car accident. An insurance company will never admit this, but adjusters often use a very basic formula to quickly predict what a jury may award you for an injury claim if the case goes to trial.
An adjuster will take your total financial loss incurred as a result of the accident and multiply it by a factor (typically two or three). For instance, if your medical bills, property damages, and lost wages amounted to $75,000, your claim may be estimated at $150,000 with a multiplier of two.
The multiplier is used to estimate other factors that may play a role in your claim, such as physical pain and mental anguish. The multiplier used can vary and there is no simple answer for determining which multiplier the insurance company will use. Generally speaking, the factor will be closely related to your medical expenses. Lower medical costs ($500-$1,000 for instance) will warrant a smaller multiplier (ranging from 1.5 to 2), where as higher medical costs could warrant a multiplier of three or four. The theory is that the more medical treatment you require, the more pain, discomfort, and suffering you will need to be compensated for.
Of course, there are other factors involved in the settlement calculation. Factors include how long after the accident you sought medical attention, your age, medical history, and circumstances surrounding the accident. The important thing to remember is that this formula for settlement value is only an estimate. Personal injury attorneys know better than anyone else that psychological injuries can’t be directly correlated with physical injuries. Even with only minor physical injuries, the traumatic experiences of a car accident can cause life-altering and severe mental health conditions. Therefore, your claim may be worth more than the insurance company estimates.
How Are Car Accident Settlements Calculated?
The true value of your car accident settlement will be a sum of the damages sustained as a result of the accident. There are ultimately three types of damages that could be involved in a Texas car accident case: economic, non-economic, and punitive damages.
Economic damages are damages awarded to compensate for financial losses. Economic damages could include medical bills, property damage, household services, vocational rehabilitation, lost wages, and loss of earning capacity. It’s important to understand that calculating medical expenses should be about more than what you’ve already paid. Your future medical expenses (surgeries, treatments, prescriptions, etc.) related to the accident should also be factored into your economic damages.
Non-economic damages are harder to estimate, because the damage isn’t as tangible. Non-economic damages include compensation for pain, suffering, reputational damage, humiliation, loss of consortium, and loss of life enjoyment.
Unlike economic or non-economic damages, punitive damages are not awarded for a loss. Rather, punitive damages are awarded as punishment for the actions of the other driver to prevent similar conduct in the future. Punitive damages are most commonly awarded in drunk driving or speeding-related accidents.
How Do I Know If I’m Entitled To A Claim?
Generally speaking, you are likely entitled to a claim if you were injured as a result of another individual’s negligence. Negligent road behavior includes, but is not limited to:
- Distracted driving
- Driving while under the influence
- Disregarding road signs or signals
It is also worth noting that the other driver is not the only individual that may be held liable for an accident. If a hazardous road condition caused the accident, local or federal government authorities can potentially be held responsible for poor design, construction, or maintenance. A vehicle or part manufacturer could also be to blame if the accident was a result of a vehicle defect or malfunction. A car accident attorney can review your accident to help you determine if you have a claim and who should be held liable.
Who Pays The Settlement?
Where your settlement comes from will depend on the circumstances surrounding your accident. The settlement will either come from your insurance, the other driver, or the other driver’s insurance company.
If the accident was your fault and you have collision coverage, your insurance company will cover your vehicle damages. If the cost of repairs is greater than the value of the car, your insurance will likely consider the car totaled and pay you a lump sum. Because Texas is an at-fault state, you will be responsible for paying your own medical bills if the accident was your fault.
If the other driver was at fault or partially at fault for the accident, their insurance company will be responsible for paying the settlement. However, policies have a set limit. If the settlement value exceeds the limit or the other driver didn’t have insurance, the other driver could be responsible for your damages paying out of their own pocket. However, if you have underinsured or uninsured motorist coverage, your insurance company may also be responsible for paying for your damages.
Does Hiring A Car Accident Attorney Increase Your Potential Settlement Offer?
It is a common misconception for accident victims to believe that an insurance company has their best interest at heart. It is important to remember that insurance companies are for-profit businesses and they will do everything they can to reduce their business expenses. Many companies will use deceptive or misleading tactics to reduce or deny your claim. Even if the insurance company isn’t trying to be disingenuous, it’s very rare that an initial offer will amount to the full value of your claim.
Individuals who choose to pursue a claim without an attorney often fall for low-ball offers and unfair settlement tactics. When an individual obtains legal representation, their personal injury attorney can help them determine the full value of their claim and fight for what they deserve.
No one wants to settle for an average settlement and you won’t be able to maximize your offer by simply submitting a claim. Your attorney will be able to persuade the insurance company to conduct a deeper investigation. If a suitable agreement can’t be made after an investigation, your attorney will file a lawsuit to ensure every penny is recovered.
Patterson Law Group Can Help You Earn What You Deserve
Patterson Law Group was founded on the basis that every injured victim of negligence deserves justice. Our attorneys do one thing and we do it well – fight for your rights. Regardless of the severity of your accident or your injuries, we can help you recover the compensation you deserve. We’ll handle your claim while you focus on your recovery.
The Texas statute of limitations for personal injuries is two years. If you fail to take legal action within two years after your accident, you will lose your ability to bring a claim. Contact Patterson Law Group today by filling out the form or calling (817) 784-2000 to schedule a free initial consultation and discuss your legal options.