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How Do Insurance Company Adjusters Determine Settlement Offers

When you file a claim with an insurance company after an accident the insurance company’s adjusters are the ones that determine your settlement offer.

Usually, the insurance company’s settlement offer is going to be substantially lower than what you may actually be entitled. Though sometimes what they offer to settle the claim may seem fair.

There are some things you should know about how insurance companies determine a settlement offer for accidents that result in injuries in California.

Insurance companies are in the business of making money, not paying it out. If they pay out more than they take in, how can they be a profitable business?

Here is how it works.

Documentation

The insurance company’s adjuster reviews all the documentation as well as other information pertaining to the accident.

It will usually include the information provided by you as well as what is provided by the party who is at fault for the accident.

Such as:

  • medical records
  • medical bills
  • tax returns
  • police reports
  • proof of income
  • property damage
  • reconstructing the accident
  • witness statements
  • pictures and/or videos
  • out-of-pocket expenses.

The insurance company’s adjuster goes through all of the information with a fine tooth comb looking for any loophole to get out of paying or to find ways to minimize your claim.

For example, the adjuster will go through your medical records looking for any prior or existing illness or injuries that could negate the injuries caused by the accident they are investigating.

The adjuster looks over any/all pictures and videos to reconstruct the accident in order to determine if there are any discrepancies they can exploit.

The same thing is done in order to prove if any property damage was the result of the accident they are investigating or if it existed prior to the accident.

Because the insurance company’s adjuster meticulously reviews information looking for a way out of being financially liable, it is always in your best interest to have a personal injury lawyer assist you with your claim, even with your own insurance company.

A personal injury lawyer can help you identify any potential problems you may have with your claim to the insurance company.

They will also help you determine the value for your claim. So, when the insurance company’s adjuster presents their settlement offer to you, you will know how close their offer is to the actual value of your insurance claim.

Settlement Offer

Once the insurance company’s adjuster reviews all the information, they add up all the non-economic damages. This is pretty straight forward and is typically just an accounting issue.

They use receipts, bills, paystubs, tax returns, and other ancillary information to help them determine the value for such things as:

  • current medical expenses
  • future medical expenses
  • property damages
  • out-of-pocket expenses
  • other economic damages
  • loss of wages/income

There is something important to remember about how medical expenses are determined by an insurance company’s adjuster.

There is something they call “soft” medical bills, which means some expenses were paid to chiropractic services, physical therapy, massage therapy, or other “alternative” care services for treatment.

Sometimes they may value these kinds of expenses significantly less than the amount of the invoice. Sometimes these expenses are devalued by more than 50%.

Determining non-economic damages can also be a bit of a headache when working with insurance companies.

Because the value of non-economic damages can be derived using various methods and is highly questionable, the insurance company’s adjuster is most likely going to low-ball you on this aspect.

Insurance companies usually have their own “in-house” methods to calculate this.

Most insurance companies require their adjusters to offer less than half of the value of the economic damages they have calculated for the first offer.

For example, if the insurance company determines the value of your claim is $10,000, they will offer to settle the claim with you for $5,000 or less.

This is why having a lawyer to assist and advise you with dealing with an insurance company is vital to getting the maximum value of your accident claim.

A lawyer will help you examine all the information, and work with the insurance company directly on your behalf so you do not get taken advantage of by the insurance company.

If you have been in an accident and sustained an injury of any kind, contact the Law Offices of Daniel Weltin to help you today.

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