A personal injury settlement agreement is one possible way to end a personal injury claim. It describes an agreement made between the plaintiff (the injured party) and defendant (the liable party) to end the case with the agreed-upon resolution. Settlements have many benefits for both parties – which is why most personal injury cases in Texas reach settlement agreements. There are some circumstances, however, when it is better not to settle as an injured accident victim.
What Is a Settlement?
A settlement is reached after negotiations between the plaintiff and the defendant, or the defendant’s insurance company, in a personal injury claim. First, the insurance company will analyze the claim and investigate the accident it involves. If the insurance company accepts liability for the accident, it will then offer the plaintiff a settlement to resolve the dispute.
The plaintiff has the choice of accepting the agreement as-is, negotiating to try to obtain a higher amount, or rejecting the settlement and taking the case to trial. If the insurance company rejects the claim, on the other hand, a settlement agreement won’t be reached, and the plaintiff may have the ability to file a personal injury lawsuit, instead.
What Are the Advantages of a Settlement Agreement?
There is a reason why the vast majority of personal injury claims reach settlement agreements. Settlements come with many benefits that personal injury trials do not have. Some of the most common advantages are:
- Privacy. A settlement agreement can be kept private, while a personal injury trial is open to the public and will go on public record.
- Control. It is up to both parties whether or not to agree to the terms of a proposed settlement. If a case goes to trial, on the other hand, both parties surrender control over the final outcome, or verdict, to a judge or jury.
- Cost. Reaching a settlement agreement, even if it involves mediation or arbitration, is cheaper than taking a case to trial. A trial requires court costs, higher attorney’s fees, expert witness fees, and other expenses.
- Time. The average personal injury settlement agreement takes around three to six months from start to finish (although some take much longer). A personal injury trial, on the other hand, has a timeline of about one year. A trial must wait until the courthouse has an open date.
Overall, a personal injury settlement agreement is cheaper, faster and generally more lucrative for both parties. This does not mean, however, that accepting a settlement agreement is always in your best interest as a plaintiff.
When Should You Reject a Settlement Agreement?
There are circumstances where accepting a settlement could mean receiving less money than you deserve for your case. Insurance companies are known for putting their bottom lines over client recoveries. This can mean a settlement offer that is inadequate for your injuries and losses. If you accept the first settlement offer without consulting with a lawyer, you may never be able to renegotiate or receive a higher amount – even if you find out later that your injuries require more medical care than you initially knew.
It is important to speak to an attorney before signing anything from an insurance company, especially a settlement agreement or a Release of Liability Waiver. If an attorney believes that you could collect more financial compensation through a personal injury trial, he or she may recommend that you reject the insurance company’s settlement offer. A personal injury trial could end in types of compensation that are not available with a settlement, such as money for your pain and suffering. There is no guarantee that you will win the case, however, if it does go to trial.
For more information about the personal injury settlement process, or advice about whether to accept a settlement, contact The Law Firm of Aaron A. Herbert, P.C. for a free consultation.