How an Insurance Adjuster Determines a Settlement Amount


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Accidents don't just happen. In almost all accidents,you can point to some one's failure to act with reasonable care that resulted in an injury to another person. If you are the unlucky person who suffered the injury as a result of another's negligence you will want to be fairly compensated. You should be compensated for your past and future pain and suffering, past and future loss of earnings and past and future cost of medical care. Payment of your "damages' is usually made by the insurance carrier for the responsible party. One question that usually arises early in the process is, "How does an insurance adjuster determine the settlement amount?" or "What is the value of my case?"

Settlement is a Compromise

First, it is this author's opinion that it is not up to the insurance adjuster to determine the amount of the settlement. Settlement, by its very terms is a compromise between two parties. There is an old saying. "That a good settlement is one where each party goes away a little bit unhappy." That is to say that the injured party accepts less than he or she really wants and the insurance carrier pays more than they expected.

Insurance Carriers Objective

Second, there is no such thing as "The Good Hands People". Insurance carriers do not exist to pay money to injured parties. Insurance carriers exist to earn money and profits and pay dividends to there corporate shareholders. Therefore the longer they can delay paying your claim, the longer they can hold onto the money they collect in premiums and invest that money to earn a profit.

Finally, there are a great many elements that go into the evaluation of a personal injury settlement. First, the carrier will never pay more than the policy limits maintained by their insured. If the policy limit is the most amount the carrier will be responsible for, even after judgment , then more likely than not they will look to "save money" off the policy in a settlement. Next, the liability or fault for the accident will be analyzed. The plaintiff, or injured party, must prove a prima facie case or make out all the elements of the case before the carrier will consider payment. The carrier will then assess if the injured party has any comparative fault for causing the accident. If there is comparative fault, then the value of the settlement will decrease. (See also Tips for Dealing with Insurance Adjusters).

The Injury(ies)

The injury will also be closely scrutinized. The objective diagnosis of the injury will be assessed. Are there x-rays or MRI studies that objectively diagnose the injured person's condition. Did the injured party make immediate complaints of pain after the accident? Did the injured party seek immediate medical care from the scene of the accident. What type of medical care was involved? Was surgery required? Over what period of time did the injured person receive treatment? Who was providing the treatment? What functional limitations does the injured person manifest? Are the conditions permanent? Were there any pre-existing medical conditions? Has the injured party been involved in litigation previously? Did the injured party lose time from work? How much did the medical care cost and what will it cost in the future? How much time was lost from work? Were there any loss of earnings? Will there be a future loss of earnings? What venue or county will the lawsuit be tried in? Who is the injured person's attorney? These are a few of the many questions asked and evaluated by insurance carriers before settling a personal injury claim.

The Insurance Company Medical Exam

Insurance carriers will also have the diagnostic films read by a radiologist of their choosing and have you examined by a physician they hire. They will use the results of these examinations to counter the findings of your treating doctors. More often than not, the insurance doctors will deem you fit to compete in the next olympics or at the very least attribute your continued manifestation of injury to a pre-existing medical condition so that the insurance carrier can argue that their insured's negligence did not "cause' your injury or the permanent result of your injury.

Each and every personal injury case is different and most be analyzed in light of the specific facts and circumstances of the case. Your personal injury case must be managed every step of the way. Your attorney must work with your doctors to insure that your injuries are properly documented. Your attorney must discover and minimize any weaknesses in the liability and injury portions of your case. Only when every "i" has been dotted and every "t" crossed, and you convince the insurance carrier that you are willing and able to push your case all the way will an insurance company pay you fair value for your injury claim.

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