Insurance settlements are one of the most thoroughly discussed factors after an accident claim. In some cases, the victim may believe the insurance isn’t offering a fair amount of compensation for the damages that the accident caused. However, it’s important to note that insurance companies often work with different methods to determine settlement amounts.
It’s vital for people to understand how an insurance adjuster operates before accepting or rejecting a settlement offer. When it comes to accident investigations, several factors may affect what the final settlement is for the victim and consulting an expert car accident attorney Des Moines offers can help.
Overall, insurance companies work with three main factors: damages, liability, and insurance policy terms. This page is going to provide users with an overview of how insurance companies determine settlement amounts in Des Moines, Iowa.
The Damages Formula
Typically, the insurance adjuster is going to add up the total medical expenses that came from the injury to come up with a metric called the “medial special damages.” The adjuster uses this metric to determine how much the victim can receive in compensation for damages in general.
In essence, the adjuster takes the number that came from the medical special damages number and multiplies it by one and a half up to five times, depending on the injury or emotional distress. It’s vital to note that the adjuster must also add lost wages to the final number.
The numbers that the insurance adjuster comes up with from the damages formula are typically the ones that the company uses to make its first settlement offer. Insurance companies don’t disclose what formula they used to calculate damages, so these calculations may vary depending on the entity.
Determining Liability
Logically, the less liability the victim has over the accident, the more likely they are to win fair compensation. If the victim is making a personal injury claim with the liable party’s insurance company, the first thing the company is going to do is to talk to the liable party to hear their side of the story.
Additionally, the company is going to go over any police reports or medical records to verify whether its client’s side of the story is true or not. If the insurer finds out that the claimant was also at fault for the accident, they may use that information to offer a much lower settlement amount.
Some other documents that may affect the final settlement amount for the claimant involve medical bills, tax returns, proof of property damage, and more. In essence, if the insurer discovers that the claimant had prior injuries or that the claim itself is confusing, they may also make a lower offer or not make a settlement offer at all.
Insurance Policy Terms
As mentioned before, the settlement offer depends on what the insurance company typically works with. Not all insurance companies work with the same policies, so it’s vital for the accident victim to know what their insurance policy terms can offer them in cases of an accident.
On the other hand, the victim may request information about the liable party’s insurance company to know what they can expect from it.
Determining the Value of the Claim
Once the insurance company gathers all the information needed to make an offer, they’re going to value the claim based on the findings. Overall, damages are valued in two categories: economic damages and non-economic damages.
In case of economic damages, all the insurer has to do is take medical bills and lost wages and do the math to come up with the claim’s value. However, in the case of non-economic damages, the adjuster must determine the value based on pain and suffering.
A pain and suffering claim is often challenging to calculate, and most people value it differently. However, many adjusters in Des Moines, Iowa now use particular formulas to value pain and suffering claims.
Making the Offer
Overall, the insurer is going to make their first settlement offer based on what they think the final value of the case is going to be. While there’s no industry standard for what the settlement amount may be, some insurance companies offer 40% of the total value of the case.
It’s important to note that insurance companies that work with plaintiffs without an attorney may offer much lower settlement amounts than those who do have an attorney.
Bottom Line
Most insurance companies in Des Moines work with different formulas and methods to calculate a fair settlement amount. However, since these companies often try to save up as much money as possible, they may try to make a low first offer.
In these cases, the accident victim needs to work with a respectable lawyer so that they can ensure a fair settlement for the damages sustained. The experts at Tom Fowler Law have worked with many insurance companies over the years, so they know most of the factors these companies use to calculate damages in a personal injury case.