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If you’ve had a car accident and filed an auto insurance claim, you have likely already been in contact with a insurance claims adjuster. The adjuster's job is to look at the circumstances of the accident and will offer you a damage settlement that can include vehicle damage and any injury you may have sustained. But how do you know whether you should accept that settlement? What if it seems lower than what you believe is fair compensation?

In situations like this, you may be unsure and feel pressured to accept the first settlement simply because you are unfamiliar with how the system works or feel intimidated.  You just want to move beyond the accident and get on with life. But.  If your car insurance settlement offer seems too low, there are some important factors you should consider. Keep in mind that you are in the best position to know the true range of impact the accident will have on your life.  If the settlement seems too low, it’s probably worth a second look.

Settlement Criteria
Insurance adjusters have the authority to make a settlement offer within a certain dollar range. Since the goal is to keep costs down for the insurance company, the first offer will likely be at the low end of that range. If you believe the proposed settlement is not adequate for the value and pain the accident caused, then you should treat the offer as a starting point only and be prepared to negotiate a counter-offer. To do that, you need to know how to put a dollar value on your loss.

Valuing a Total Loss Car and other claim expense
Insurers often use a very low book value that does not necessarily reflect actual worth. Find similar vehicles (year, model, condition) and build a comparative price point. Take into consideration regular maintenance, mechanical soundness, and what your vehicle might have sold for prior to the accident. A great resource is nadaguides.com Claim value doesn’t only include the car, but also the inconvenience of being without a vehicle. How did the accident interfere with going to work or other daily activities? The value of the claim is also affected by who is at fault. If you contributed in any way to the accident, companies will sometimes try to hold you to a higher level of fault as a way to underpay your claim. If you were negligent, for example, the company may decide you contributed to worsening the damage or injury.

Placing a value on injury is a bit more complicated, as the true extent of the injuries can take time to manifest. Maintain a journal documenting any pain or debilitation, including information on how the injury is impacting your ability to work, care for children, or perform daily tasks. Keep an accurate record of medical bills, out-of-pocket expenses, travel mileage and prescription drug costs. Consider the future. Many accident injuries that seem minor, i.e. whiplash, can have significant serious and debilitating consequences over time. In most cases where injury is present, it is in your best interests to not accept a settlement until you have a better idea of the long-term consequences.

Dealing with the Adjuster
Once you have calculated what you believe the accident settlement is worth to you, decide on a reasonable range and minimum amount you will accept. Decline the first offer in writing. Explain the reasons why you believe the offer is inadequate, including the facts of the case, documented damage and the nature of the injuries. Be prepared to counter-offer with an amount at the high end. The negotiations may take some back-and-forth, as the insurance adjuster will likely make a counter-offer that is lower than what you are asking, and you will need to decide whether to accept. 

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In some cases it may be wise to seek legal advice.  For example, if the accident involves significant injury or if children are involved. Ultimately, if you cannot resolve the matter by dealing directly with the company, you have the option of going to court.

In general, if your car insurance settlement offer seems too low, it’s worth asking for a reassessment, even if you only manage to negotiate a small increase.  If you feel that your insurance adjuster has given you a fair and reasonable offer from the start, even if it is on the low side, it may be in your best interests to accept and move on with your life. Negotiating and valuing your claim and waiting for a higher settlement can take time and effort and you may decide that it’s not worth it, but if you have the patience and financially resources then the process can result in more money in your pocket.

I've shared some very generic advice in this article, but I do have very specific Arkansas Insurance rules, regulations and talking points that I'm happy to share if you're in a claim process and having a difficult go at it with your adjuster.  Call or email me and I will be happy to help with any information or tips specific to helping you with your situation.  I have personally had to negotiate a total loss settlement and  know how to get the most money for a claim. 

DISCLAIMER: I am not an attorney and this is not intended to be legal advice.  I am an insurance agent.  If you have legal questions, you may want to contact an attorney. 

About the Author:

DJ Noland is a licensed insurance professional in the state of Arkansas and managing Principal of McGhee Insurance Agency of North Little Rock, AR. Our NLR office specializes in placing insurance protection for individuals and families & businesses in Arkansas and would love to visit with you on your auto insurancehome insurance, personal umbrella insurancebusiness insurance boat insurance, RV insurancelife insurance or health insurance protection to help structure a plan to protect what you've worked so hard for and will work hard for in the future.  

Not in NLR?  No problem, contact the office closest to you [click here for locations] 

[Click here to contact DJ today.]


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