Dealing with insurance companies after you have been involved in an accident can be stressful. You are probably busy dealing with issues like medical care and transportation issues while your car is at the garage. the last thing you need is some random person telling you what your experience is worth in terms of compensation.
Insurance companies use precise formulas to come to settlement offers. Important factors include the number of people involved, repair estimates for damaged vehicles, and medical reports.
However, insurance companies will never offer you the full amount in their settlement offer compared to what a court might award because they are trying to get you to accept less. We can shed some light on the methods for how insurance companies arrive at their compensation packages for settlement offers and what information you should be aware of if you are negotiating with them. You should also know that you can speak to a lawyer at any time. An attorney can go over a settlement offer and negotiate on your behalf.
The excellent Maryland car accident attorneys at Rice, Murtha & Psoras have the experience and resources to demand equitable solutions from insurance companies, or else bring them to court. For a free initial consultation, call us at (410) 694-7291.
What Information Goes into a Car Accident Settlement Calculation in Maryland?
When an insurance company is trying to put together a figure for compensating you after an accident, they will attempt to total up the costs associated with your injuries and the damage to the vehicle.
Damages to Vehicle
For deciding the appropriate amount of damages for the vehicle, several factors come into play. Insurance representatives will consider both the initial value of the car at sale and the depreciation of the car’s value. They will also take into account the condition of the particular vehicle at the time of the accident and the mileage.
Depending on the nature of the damage, the cost of repairs may vary. Typically, more common forms of damage will require a lower cost for repairs since the replacement parts are more readily available. For instance, if you were involved in a fender bender, the damage to your car’s fender could be superficial. If the damage can’t be buffed out, getting a replacement fender is not complicated and is often relatively inexpensive. Conversely, if the damage goes so far as to impact more crucial parts of the vehicle such as the engine or chassis, the cost of repairs could be far more expensive.
If the cost of repairing the damage is greater than the overall value of the vehicle after depreciation, the insurance company will usually “total” the vehicle and offer to pay its remaining value rather than repair it.
Replacement parts for imported cars and after-market modifications may make calculations much more difficult, and you may not get what you are looking for. This is because the insurance company will typically use the market value of the replacement parts needed. However, if your car is rare or an import, simply finding these parts for sale can be difficult and costly. If you have made after-market modifications, an insurance settlement typically will not take into account the time and effort you spent on the project. Insurance may also offer to pay only for cheaper generic parts rather than the right manufacturer’s official parts.
Injuries to the Person
There is no Blue Book value for personal injury suffered as a result of a car accident. Injuries often make calculating a reasonable settlement offer much more complicated.
However, insurance companies may take a similar approach in coming to a compensatory value as they use for vehicle damages. In other words, insurance representatives will take into account certain information about a person that might lessen or exacerbate an injury caused by a car accident. Facts such as age, activity level, earning potential (if the injury impacts ability to work), and vulnerability will likely figure into a settlement offer in various ways.
As an example, let’s say two people are in a car accident caused by another driver’s negligence. the driver of the car is an elderly man who is retired, and the passenger is a highly acclaimed track and field athlete.
If the elderly man were to suffer a broken collarbone, he could be compensated for the costs associated with his medical care but would not receive compensation for lost wages or earning power since he is not working. However, if the athlete were to suffer the same injury, it might prevent her from getting scholarships, sponsorships, or competition opportunities for an extended period of time. the athlete’s compensation package in this instance could be much larger than the retiree’s, even though the injury is the same.
How Do Insurance Companies Come Up with Settlement Amounts?
Insurance companies’ methods for arriving at compensatory figures for car accidents in Maryland depend on what is being claimed. If the person who was injured (the “claimant”) is merely claiming compensation for medical expenses, then the insurance company will simply tally up the recorded costs. However, if the claimant is also seeking damages for pain and suffering, the calculation becomes a little bit more complicated.
The phrase “pain and suffering” is legal language that is used to describe how people who are injured are impacted mentally and emotionally by the accident and their injuries. Many who experience the trauma of a serious car accident deal with chronic pain and psychological consequences for extended periods of time as a result. Maryland law allows these victims to recover in court for these additional damages, also called non-economic damages. As a settlement is really just an agreement that the rightful claimant will not bring their case to court, a prudent insurance company will try to factor these damages into their compensation package to make it more reasonable and alluring.
The method that most insurance companies use to account for pain and suffering damages is called the “multiplier method.” the theory behind the multiplier method is that accidents which have created more direct costs like medical bills and property damage are also likely to have caused more pain and suffering. To that end, insurance companies will apply a formula that multiplies the total damages to get a pain and suffering amount. the formula will vary depending on the nature of the injuries. For instance, a high-speed collision on a highway might warrant a higher multiplier for damages, while a fender bender would use a very small multiplier.
Are Insurance Settlements for Car Accidents in Maryland Fair?
If you are dealing with someone else’s insurance agent after a car accident, it is typically because the other person negligently or recklessly caused the car accident. You should remember that the goal of the insurance agent is to limit their own company’s liability. If that means trying to get you to agree to a settlement that is substantially lower than you could recover in court, then that is what they will do.
Insurance agents are not on your side. That is why you need a seasoned Baltimore car accident attorney. Your lawyer can communicate with the insurance company on your behalf, negotiate a fair settlement, and, if need be, bring your case all the way through court to get you fairly compensated for the damages sustained in your car accident.
We Can Help You Get the Car Accident Insurance Settlement that You Deserve
The respected Ocean City car accident attorneys at Rice, Murtha & Psoras are ready to fight for what you deserve, just as we have done for numerous clients before. To hear more about our services, schedule your free initial consultation by calling our offices at (410) 694-7291.