Negotiating Settlement in Catastrophic Injury Cases

Understanding Catastrophic Injury Cases

A catastrophic injury that suddenly occurs, is often the result of a very serious car accident. This type of injury causes serious physical damage to a body. It is usually permanent without the hope of full recovery. The consequences of this type of injury changes a victim’s life forever. Spinal cord, paralysis, amputation, loss of hearing or sight, facial injuries, deformity, nerve damage, brain injuries, severe organ damage, and  burns are just some of the examples of catastrophic injuries.

The more serious the injury, the greater the medical expenses. Several surgeries, extensive rehabilitation, and permanent medical devices will be required. If out of work, wage loss will be extensive. The pain and suffering will also be greater. A catastrophic injury also impacts not only the victim, but the family. Providing ongoing care to a victim with mobility or cognitive issues is very emotional, exhausting, and costly. 

Importance of Effective Negotiation in Catastrophic Injury Cases

In a catastrophic injury case, effective negotiations are essential for obtaining the compensation the victim deserves. In these types of cases, the victim and her family have experienced significant physical, emotional, and financial burdens. They are very vulnerable and need guidance. To assist them requires a thorough understanding of their needs.

Before negotiations in a serious car accident can take place, a complete understanding of the facts are required. The full extent of the  injuries must be understood and documented. Ongoing care and rehabilitation, daily assistance, and constant monitoring are just a few of the requirements with a catastrophic injury.   Is there permanency that will require constant medical care and treatment into the future?  In these types of  injuries, both the past and future medical expenses must be obtained as well as past and future wage loss. Witness statements, photographs, diagrams of the scene, and accident reports must be gotten.

It’s important to identify all applicable insurance coverage. Automobile insurance policy limits for both the tortfeasor and the victim, coverage under the victim’s health insurance coverage, and  disability insurance  must be identified and confirmed in writing. Always require a certified copy of all applicable insurance policies.

In catastrophic injury cases, having a strong negotiating team is crucial to make sure the victim’s interests  are adequately represented in an effective manner.  This strategy starts with an experienced catastrophic injury lawyer who specifically focuses on these types of cases. This lawyer along with her legal team can provide a victim with a roadmap for recovery. She can identify the responsible parties, negotiate with the insurance companies, and deal with both the medical and financial experts. Dealing with these experts will result in the victim’s past and future financial security.

Compensation After a Catastrophic Injury

In a catastrophic injury case, the clear objective is to obtain adequate compensation for the major impact the  injuries have had on the victim. To assist, certain compensation goals must be met. Catastrophic injuries usually require extensive medical treatment which includes ongoing care and rehabilitation. Obtaining complete medical records and bills is one of the common objectives. These injuries often result  in permanent disability which precludes the victim from employment. Getting compensation for lost wages and future earning capacity is another common but important objective. Pain and suffering which includes emotional distress and a diminished quality of life, is another objective which can be addressed. Emotional distress is often significant. Seeking compensation for the pain and suffering and emotional distress is a third objective. Determining compensation goals is best discussed with an attorney who specializes in these types of cases. She can guide the victim through the process providing that all these goals are met while establishing realistic expectations. 

Initial Contact with the Insurance Company

All states have a time frame within which a victim must file her lawsuit. Known as the statute of limitations, if not timely filed, then the case will be dismissed. With this time frame limitation, it is imperative to contact the tortfeasor’s insurance company as soon as possible. Either by mail, email, or fax, send a  letter advising them of  the case. This  allows it to begin investigation into the claims. Make sure to document all communications with the insurance company. 

Documenting Damages

Documenting damages in a catastrophic personal injury case is very important. The information you gather will be used by the insurance company to evaluate your claim. Take photographs of the accident scene which includes damage to the vehicles. Get the names and contact information for any witnesses. Gather the police  report. If there is property damage, get at least two estimates of either the repair or the total loss amount. Gather all  past and future medical records and bills. If there is loss of both income and future earnings, have your employer confirm the loss by a letter. Use experts to assist you in medical opinions, permanency, future loss of earnings, and loss of enjoyment and quality of life. Gather all insurance policies that are applicable in your case. Your automobile and health insurance policies, as well as the tortfeasor’s automobile policy are necessary in order to know coverage limits. The retrieval of documents is complex and may vary depending on the circumstances of your case. It’s best to always contact a personal injury attorney who can assist you through this process.

Crafting a Demand Letter

A demand letter is sent to the person who is responsible for your injuries. In that letter, compensation will be demanded. It is usually sent to the insurance company of the responsible party.  In the letter, write  a concise statement of the facts detailing the accident  which led to your injuries.  Include time, date, location, and the cause of the accident. Support the letter with evidence that establishes clear liability. Witness statements, police reports, and photographs should be included in the letter.

Include specific details of your injuries and damages by attaching medical records and bills, lost wages, pain and suffering, and property damage. Demand full compensation based on the evidence that was presented. Include your signature at the end of the letter along with your contact information. Always consult with a personal lawyer before sending out a demand letter. They will help you prepare it and negotiate with the insurance company resulting in favorable compensation.

Negotiation Strategies

Often, catastrophic injury cases settle before trial through the negotiation process. This process involves your attorney and the insurance adjuster reaching a settlement agreement.  Having strong evidence on liability, causation, and damages, will result in a settlement that will provide the long lasting compensation you need. If your attorney and the insurance adjuster can not settle the case, arbitration or mediation can be effective in resolution.

Arbitration is an alternative dispute resolution process. It involves an arbitrator who is a disinterested third-party. She will review the evidence and award an amount for damages. This process is less formal and  less expensive than a trial. It is also less stressful. The arbitrator’s decision can be binding or non-binding. If binding, both parties agree to accept the decision and waive their right to appeal. If non-binding, either side can reject the decision and proceed to a trial.

Mediation is another form of alternative dispute resolution. Both sides will present their evidence to a neutral third- party  mediator. The mediator will assist the parties in reaching a settlement. The mediator does not make a decision on compensation. Mediation is voluntary and non-binding. Either party can reject the mediation and proceed to a lawsuit. It is less adversarial  and less costly than litigation.

Counteroffers and Settlement Discussions

Settlement discussions are used extensively in personal injury cases to avoid going to trial. Demand letters and counter-offers play a key role in these discussions. After obtaining and reviewing  all the evidence, a demand letter for settlement will be sent to the insurance company. It will outline the liability of the defendant as well as all the damages the plaintiff is requesting.

Once reviewed, the insurance company will propose a counter offer in response to the demand letter. At this time, both sides will go back and forth negotiating an agreed to settlement number. It is important to carefully assess all settlement proposals in light of the evidence presented. Through this review, a fair settlement will be reached. All settlement negotiations are voluntary and non-binding.  Either side can reject the settlement and file a lawsuit. Again, settlement negotiations are less adversarial and less expensive than a full trial. Even after a lawsuit has been filed, settlement  negotiations can continue.

If the case is settled, there will be a release – a signed agreement – between the injured victim and the defendant which resolves all claims without going to a trial.  It can be settled at any time during the legal proceedings. A release must be included. A release is a legally binding agreement that is signed by both of you. It releases the defendant from any further liability. It also precludes you from pursuing any other claims for your damages. The release will state the amount, the parties, and all the resolved claims. Reviewing all the terms is essential.  Once signed, you will need to discuss the time frame for receipt of the settlement proceeds to ensure a timely payment.

Filing a Lawsuit for A Personal Injury Claim

If you are unable to settle your catastrophic injury case, you will have to file a lawsuit. Remember it must be filed within a certain time frame. If not, the case will be dismissed by the court. A lawsuit is a legal process in which you as the plaintiff bring claims against the defendant who is the person that injured you. You will file your  lawsuit(complaint) in the proper court of law. A jury, guided by the court, will decide your case and either award you damages or find in favor of the defendant. Once filed, the defendant must respond to the complaint or a default judgment will be entered in your favor. After answering, discovery will take place.

Discovery involves gathering the evidence to present to the jury. To gather that evidence, the legal process allows for interrogatories, requests for production of documents,  admissions, depositions and other evidence gathering procedures. By this process, both sides learn of each other’s evidence which will prevent surprises at trial. It also helps each party to  fully prepare their case. Once complete, the court will set the matter for trial.

A trial is costly and stressful. The outcome is never guaranteed as the jury will decide the case. Even if you win, in many states, the cap on damages will significantly reduce the jury award. Deciding to settle or try the case is always a complex decision. On one hand, settling  the case without trial provides guaranteed compensation now  for your damages. While going to trial can result in a larger verdict, the jury could also side with the defendant and award you zero. Also a jury award can be appealed preventing you from the award for quite some time.

About the Authors: Sawan & Sawan is a multi-generational, family owned law firm practicing law in the areas of car accidents, truck accidents, and other personal injury. Our firm practices law in Ohio, Georgia, and Michigan.

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Dennis P. Sawan

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Christopher A. Sawan

Partner

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