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A Personal Injury Settlement Breakdown

Successfully navigating a personal injury claim requires a clear understanding of the personal injury settlement process. In such settlements, injury victims receive compensation for medical expenses, lost wages, pain and suffering, and other injury-related damages. Each component of damages is necessary to determine the total value of your case. 

This process can be time-consuming and requires detailed assessment and precise calculation of losses, as well as skilled negotiation and a deep familiarity with legal principles. This post delves into the complexities of personal injury settlements, outlining key elements and procedures you need to know. We provide this essential knowledge to increase your chances of receiving a fair personal injury settlement. 

Breakdown of a Personal Injury Settlement

If you have been harmed due to someone else’s negligence, you can seek compensation through a legal settlement for the harms and losses they have caused you. Your settlement should encompass all components of your losses, commonly called damages. Every case differs, but the most common damages that make up a personal injury settlement include: 

  • Medical expenses. The cost of all medical treatments related to injuries sustained in the accident, including ambulance bills, hospital stays, surgeries, medications, physical therapy and other medical treatment. You can also ask for compensation for future expected medical treatment if your medical provider has indicated you will need it. 
  • Lost wages and future earning capacity. If the injury led to a temporary or permanent inability to work, you can ask for compensation for lost wages. With severe injuries resulting in a diminished capacity to earn in the future, the settlement may also factor in your lost earning potential.
  • Property damage. If the incident damaged your property, such as a vehicle, your settlement might include vehicle repair or replacement costs. 
  • Pain and suffering. Pain and suffering is compensation for your physical pain and emotional distress caused by the injury. It is considered an intangible loss because there is no associated financial proof or documentation available. It’s a subjective value and potentially one of the largest components of your settlement.
  • Loss of Enjoyment of Life.  Loss of enjoyment of life is different from pain and suffering.  These damages encompass your losses from being unable to do activities that you would otherwise be doing but for the accident, including things like social activities, workouts, vacations, family events and the like. 
  • Permanent impairment/disfigurement. In Colorado, if your injuries leave you permanently impaired (reduce your body’s ability to function normally) or disfigured, you can ask for compensation separate and apart from pain and suffering. 
  • Punitive damages: The court may award punitive (or “exemplary” damages in cases where the defendant’s actions were intentional, reckless or demonstrated malice. Punitive damages are designed to punish the defendant and deter similar actions in the future. Punitive damage awards are very rare in Colorado. 

Colorado law doesn’t require hiring a lawyer for a personal injury claim. However, hiring one is highly recommended. When you hire a personal injury lawyer at Sloat, Nicholson & Hoover, P.C., we will do our best to help you receive full and fair compensation for your injuries and losses.  

Personal Injury Claim Settlement Process

The settlement process for a personal injury accident  has many components that structure the claims process. If you choose to hire legal counsel, such as our experienced team at Sloat, Nicholson & Hoover, P.C., you’ll schedule an initial consultation and case evaluation. We will listen carefully to what happened, identify who’s at fault, assess the impact on your life, and advise you on whether you have a viable case. 

The next step is filing a claim with the other party’s insurance company and with your insurance company.  Once you have legal representation, the other party’s insurance company cannot speak directly with you and must direct all correspondence to your attorney. 

Once a claim has been opened, the next step is gathering and preserving all relevant evidence needed to build the case. Documents include witness statements, police reports, medical records, medical bills, proof of lost income and any other possible evidence to support your claim. 

If you are still getting medical treatment, it’s best to wait to submit your claim until after you have completed treatment or have been told by your doctors that nothing more can be done. At that point, your claim will have its maximum value. Your attorney will then prepare a written claim summary and financial demand comprised of all the documentation gathered and send it to the insurance company for consideration. 

If the insurance company makes a settlement offer, your attorney will evaluate and relay the offer to you. Should you reject the offer, your lawyer will make a counteroffer. It might take several rounds of negotiation before reaching a settlement. Keep in mind that not all cases can be successfully settled. If a settlement cannot be reached, the next step in the legal process is to file a lawsuit in court. 

Once all parties agree on a settlement amount, you must sign a release of the at-fault party and their insurance company. After you sign the release, the insurance company sends the settlement check to your attorney to deposit in an escrow account. After ensuring that all outstanding liens are taken care of, your attorney will take their costs and fees, provide you with a written statement of how the funds will be distributed, and the claims process will come to a close.  

How to Negotiate a Personal Injury Settlement

Negotiating a personal injury settlement requires strategic planning, detailed knowledge of the case, and an understanding of legal principles. Here are some tips for effective negotiation: 

  • Gather comprehensive evidence before entering negotiations. In order to successfully obtain a personal injury settlement, there needs to be documented and thorough proof of your injuries and their impact on your life.  If you don’t have documentation of the incident or your damages, don’t expect a fair offer from the insurance company. Solid evidence strengthens your position during negotiations, and ensures that you are seeking fair compensation for what happened. 
  • Understand the total value of your claim. Accurately assess all economic and noneconomic damages based off the documentation gathered. 
  • Articulate your case clearly. During negotiations, present your case effectively. This means clearly outlining how the injury occurred, the at-fault party’s liability, and the impacts on your life. A compelling narrative can influence the negotiation in your favor.
  • Be prepared for counterarguments. Insurance companies will present counterarguments to minimize their payout. Anticipate these arguments and prepare responses to maintain a strong position.

Rather than try to negotiate a settlement on your own, hire a skilled personal injury law firm like Sloat, Nicholson & Hoover, P.C. We can navigate complex negotiation scenarios, counter lowball offers, and work towards achieving a settlement that reflects the actual value of your claim.

How is a Personal Injury Settlement Calculated

In the past, insurance companies generally used two methods to calculate the value of your claim—the multiplier or the daily rate method. Those days are gone. 

With the introduction of computer-based claims software 20 years ago and artificial intelligence (AI) in the last three years, insurance companies now use a number of factors to determine what they will offer in a personal injury claim, including:

  • Doctors’ diagnosis codes, 
  • Medical bills, 
  • Severity of injuries, 
  • Severity of the impact or incident, 
  • Car repair estimates, 
  • Any prior injuries or accidents, 
  • Impairment ratings,
  • Jury verdict data, and 
  • Past settlements made for similar injuries. 

The important thing to remember is that the more serious the injury, the more documented medical treatment you receive, and the more documented lost income you suffer, the larger the value of the settlement will be.

Insurance companies also factor in your percentage of liability in the accident. Under Colorado law, you can still collect some of your damages if you are less than 50% at fault. For example, if your damages are worth $150,000 and you’re 20% at fault, you’d receive $120,000.   If you are 50% or more at fault for the collision or incident, Colorado law bars you from receiving any damages. 

Contact a Colorado Personal Injury Lawyer 

If you have questions about a personal injury settlement breakdown, contact Sloat, Nicholson & Hoover, P.C. Our experienced attorneys excel in calculating and negotiating personal injury settlements. We understand the importance of accurately assessing your claim and advocating on your behalf. 

With our dedicated team by your side, you gain a legal advocate committed to securing a fair and just resolution for your case. Don’t navigate the personal injury claims process alone; let our experience and knowledge work for you. Call or visit our website to schedule your consultation and start your journey toward a successful settlement.

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