How Alabama Car Accident Settlements Work: A Guide to the Process

Being injured in a car accident can change everything. Most car accident survivors want life to go back to normal as soon as possible. A settlement is one way to make that happen.

Car accident settlements are quite common. Contrary to what we see in movies and television, over 90 percent of all car accident cases settle out of court. But how does the settlement process work? Here’s a step-by-step breakdown of how Alabama car accident settlements work.

Step 1 – You hire a Birmingham accident attorney

The most important thing you can do to help your settlement is to hire a car accident attorney. Here are some reasons why.

First, the insurance company will be asking you questions and asking for statements. Eventually, you will have to give a statement. An experienced Alabama injury attorney can help you give a statement that won’t hurt your case.

Second, the insurance company’s main goal is to avoid paying money. So, the insurance adjuster’s investigation will focus on things that help them justify the lowest payment possible. Your attorney, on the other hand, will investigate in a way that helps your case.

Third, having an attorney will make a big difference in the final settlement. Studies show that on average, people who hire attorneys get settlements that are $60,000 more than people who represent themselves. Handling your case on your own could be a costly mistake.

Finally, lawyers know the deadlines. In Alabama, you usually have two years to file a personal injury case. But some claims, like wrongful death, have special deadlines. Even if you plan to settle your case, your lawyer will need to follow these deadlines to protect your right to recover damages. 

Failing to hire an accident attorney – or waiting too long to hire one – could derail your case. Contact an accident attorney as soon as possible after your accident.

Step 2 – We file an insurance claim on your behalf

There are many things you should do in the aftermath of an Alabama auto accident. One of the most important is filing a claim with the other driver’s insurance company. This will start your personal injury claim. (You should also notify your own insurer.)

Step 3 – The insurance company investigates

As soon as the accident is reported, the insurance company will begin its investigation. The insurance company wants to know everything about how the accident happened and how it affected you. So, the adjuster will probably ask you for things like the official police report about the accident, any pictures of the accident scene, and copies of your medical bills.

Some adjusters might also ask you to give a recorded statement about the accident. But this statement could be used against you during settlement negotiations. So do NOT give a statement to the insurance company until you talk to a Birmingham personal injury attorney.

Step 4 – Your case is evaluated

Based on the evidence found during the investigation, your attorney will assign a value to your case. The worth of your case will be determined by many different factors including the severity of the bodily injury caused by the auto accident, your emotional distress, your economic losses, and the strength of your case. Your Birmingham personal injury lawyer will look at all of the factors and decide how much your case is worth.

Step 5 – Your attorney makes a demand

After your accident lawyer decides how much your case is worth, they will put that information in a demand letter. A demand letter will explain three main things.

First, it will explain why the other driver was the one who caused the accident. This matters a lot because Alabama follows a rule called contributory negligence. This law says that the person who is at fault cannot recover any damages. So, the letter must make it clear that you were not at fault.

Second, the letter will outline your damages. These include your physical pain, your emotional injuries, and your economic losses (money spent on things like medical bills and car repairs, time lost from work).

Finally, the letter will state how much you are asking for – or demanding – from the other driver. Ideally, this amount should be enough to fully compensate you for all of the injuries and losses caused by the car accident.

Step 6 – The insurance company responds

Once the insurance company gets your demand, it will reply. They can accept your demand without any further negotiation. However, this is rare. Remember, insurance companies want to avoid paying money at any cost.

The insurance company could also reject your demand or claim outright. If this happens, it’s likely that your case will head to trial. However, most insurance companies try to avoid this.  

Rather than accepting or rejecting your demand, it’s far more likely that the insurer will reply with a different, lower number. This number is the counteroffer. The counteroffer could be based on conflicting witness statements, different medical diagnoses, or anything the insurance company thinks it can use to achieve its goal of paying you as little as possible.

Step 7 – The parties negotiate

The counteroffer kicks off a negotiation process where your accident attorney and the insurance company will go back and forth until they can reach a number that everyone can accept. The negotiation process can last for weeks or months. It all depends on how far apart your demand is from the insurance company’s offer.

Insurance companies are known to make “lowball” settlement offers that won’t come close to compensating you for all of your injuries and economic losses. An experienced Alabama injury attorney knows the insurance company’s tricks and will work hard to get you a fair settlement.

Step 8 – You accept the settlement offer

At some point in the negotiations, your accident attorney will probably come to you with a number from the insurance company that seems reasonable. At this point, the lawyer will probably encourage you to settle. The rules of legal ethics say that while your attorney can tell you the pros and cons of a settlement, they cannot settle the case without your say-so. But if an experienced Birmingham car accident lawyer says that the settlement is a fair one, you should trust that advice.

Step 9 – Checks are issued

After you sign the settlement documents, the insurance company will cut a check. But this check will not go to you – it will go to your personal injury lawyer. Why? There are a few reasons. First, the lawyer will deduct their fees for the case. Second, if your settlement is based on medical bills that were covered by your health insurance or paid by a hospital, they might have filed a lien against your settlement. Your injury lawyer will write a check to take care of any such issues.

Once these expenses are covered, your car crash attorney will write you a check for the remaining amount.

We can help you learn more about how Alabama car accident settlements work

We hope this article helped you learn more about how Alabama car accident settlements work. If you still have questions about accident settlements in Alabama, don’t hesitate to contact Collins Law, LLC. We take car accident cases throughout the state of Alabama. If you’ve been injured in a trucking accident, car accident, or any other type of collision, we can help. Schedule a free, no-obligation consultation today by calling 205-588-1411 or using our website’s online scheduling tool.