After a serious accident, you are focused on healing. But soon, you must deal with the other party’s insurance company. This is intimidating, and many people wonder about the company’s motives.
The big question is, do insurance companies want to settle out of court? The simple answer is yes, they often do. But it is crucial to understand that their desire to settle is not driven by kindness or concern for your well-being.
An insurance company is a business, and its primary goal is to protect its financial bottom line. Settling a claim is a business decision, a calculated move designed to resolve a problem for the lowest possible cost. For expert guidance, contact our personal injury lawyer in White Plains.
Their goal is to close your file quickly and cheaply. Your goal is to secure fair and full compensation for everything you have lost. These two goals are fundamentally in conflict, and navigating this dynamic is the key to a successful personal injury claim.
- An insurance company’s willingness to settle depends entirely on whether it serves its financial interests.
- They weigh the cost of a settlement against the potential risks and expenses of going to trial.
- Understanding their motivations can help you and your legal team build a strategy to secure the compensation you deserve.
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Why Settling is Often the Default Strategy
To understand why an insurance company might want to settle, you must think like they do. They operate on a model of risk management. Every claim represents a potential financial loss, and their job is to minimize it.
Going to court is their most significant risk, so they often prefer a settlement negotiation's predictable and controlled environment.
The High Cost of Going to Trial
A courtroom battle is incredibly expensive, even for a large insurance corporation. These costs go far beyond just the final verdict. When a case goes to trial, the insurance company has to pay for a long list of expenses that add up quickly.
- Attorney’s Fees: The insurance company must pay its own defense lawyers for hundreds of hours of work, including preparation, depositions, and time spent in court.
- Expert Witness Fees: For complex cases, like a medical malpractice claim or a major truck accident on the I-495, they must hire and pay for expensive experts. This can include accident reconstructionists, medical specialists, and economists to testify on their behalf.
- Administrative and Court Costs: There are numerous other costs, from court filing fees and paying for trial exhibits to stenographer fees for depositions.
The Unpredictability of a Jury
This is perhaps the biggest reason insurance companies want to settle out of court. A jury is the ultimate wild card. While defense lawyers can try to predict what a jury might do, there are no guarantees. Your story of pain and suffering could deeply move a sympathetic jury in a place like the White Plains or Brooklyn.
- A jury could award an amount far greater than you were willing to accept in a settlement. This is often called a "nuclear verdict" and it is a major fear for insurers.
- Juries are human. They might connect with your story of loss, seeing you as a neighbor and community member rather than just a case number.
- A public trial can also result in negative publicity for the insurance company and their client, especially if the company’s actions seem particularly unfair.
When an Insurance Company is Motivated to Settle Your Claim Quickly
While most insurers prefer to settle in theory, their motivation to offer a fair settlement depends on the strength of your case. When they see a well-documented claim and likely to succeed at trial, their desire to settle out of court increases dramatically. They know that fighting a strong case will likely cost them more in the long run.
Clear Liability
The most straightforward reason for an insurer to settle is when it is obvious their client was at fault. This is called "clear liability," and it removes the insurance company’s main defense. If they cannot argue that you were the one who caused the common accident, their position becomes much weaker.
- Damning Evidence: This could be a police report that clearly assigns fault, video footage from a traffic camera at a busy Queens intersection, or multiple credible eyewitnesses.
- Admissions of Fault: Sometimes, the at-fault person apologizes or admits what they did at the scene. While not always admissible in court, it can be a powerful factor in negotiations.
- Violation of Law: If their client was arrested for driving under the influence (DUI) or received a ticket for a clear traffic violation like running a red light, it becomes very difficult to deny responsibility.
Serious Injuries with Strong Medical Proof
The severity of your injuries plays a huge role in the insurance company’s calculations. A minor claim with a few doctor visits is something they might fight over. A catastrophic injury with extensive medical records is a different story. They know that a jury will see the profound impact the accident has had on your life.
- Objective Medical Evidence: This includes MRI scans showing a herniated disc, X-rays of broken bones, or detailed reports from surgeons. This type of proof is hard to argue with.
- A Clear Prognosis: When your doctors provide a clear, long-term prognosis, the expected future course of your medical condition, which shows you will need lifelong care or will have permanent limitations, the claim's value increases significantly.
- Consistency in Treatment: Following your doctor's treatment plan without interruption creates a powerful medical record demonstrating the seriousness of your injuries and your commitment to recovery.
You Have Experienced Legal Representation
Many people overlook this factor, but it is one of the most important. The insurance adjuster’s job is to save the company money. When they are dealing with an individual, they hold all the power.
When they see that you have retained a respected law firm known for taking cases to trial, the entire dynamic shifts.
- They know they cannot use their usual tactics of lowball offers, confusing language, or unreasonable delays.
- They know your legal team understands the true value of your claim and will not be fooled into accepting an inadequate amount.
- They know your lawyers are building a case for trial from day one, which signals that you are serious and have the resources to see the fight through to the end.
The Other Side of the Coin: Why Insurance Companies Refuse to Settle
Of course, there are many situations where insurance companies dig in their heels and refuse to make a fair settlement offer. This happens when they believe they have a strong chance of winning in court or can significantly reduce the amount they have to pay. Understanding these reasons is just as important.
They Believe You Are Partially or Fully at Fault
New York follows a legal rule called "pure comparative negligence." This rule says that if you are partially at fault for an accident, you can still recover damages, but your final award will be reduced by your percentage of fault. Insurance companies use this rule to their advantage whenever possible.
- If they can convince a jury that you were 25% responsible for the accident, they can cut any potential verdict by 25%.
- They will look for any evidence to support this, such as suggesting you were speeding, not paying attention, or made a sudden move.
- Even if their argument is weak, the threat of blaming you can be a tactic to pressure you into accepting a lower settlement.
They Question the Severity or Cause of Your Injuries
Another common defense tactic is to dispute the injuries themselves. The insurance company might argue that your injuries are not as serious as you claim or that they were caused by something other than the accident.
- Low-Impact Accidents: In a car accident with little visible vehicle damage, they will often argue that you could not have been seriously hurt.
- Pre-existing Conditions: They will comb through your past medical records to find any prior injuries or conditions they can use to claim that your current pain is not from the accident.
- Gaps in Treatment: If you wait too long to see a doctor after the accident or have unexplained gaps in your physical therapy, they will argue that you must not have been that injured.
A Calculated Strategy: The "Delay, Deny, Defend" Tactic
Sometimes, an insurance company’s refusal to settle is part of a deliberate and cynical business strategy. Some insurers are notorious for using a "delay, deny, defend" approach to wear claimants down.
- Delay: They intentionally drag out the process, hoping that your financial desperation will force you to accept a fraction of what your claim is worth.
- Deny: They will issue a blanket denial of your claim based on a flimsy excuse, forcing you to go through the trouble of filing a lawsuit.
- Defend: They will aggressively defend the lawsuit, not because they expect to win, but to make the process as long, expensive, and stressful for you as possible.
Navigating the Path to a Fair Resolution
So, do insurance companies want to settle out of court? Yes, but only on their terms. They want to settle for the lowest amount possible, protecting their profits. Your goal is to secure a settlement that is fair and just, protecting your future.
At Queller Fisher, we understand the tactics that insurance companies use because we have been fighting them for decades. Our firm is built on meticulous, personalized legal representation for those who have suffered the most serious injuries.
This reputation for readiness compels insurance companies to take our clients' claims seriously and offer substantial settlements. We are available 24/7 to listen to your story. We offer free consultations by phone, video, or in person, and we will come to you if you are unable to travel.
Call our team in New York City at (212) 406-1700 or in the White Plains at (718) 892-0400. We provide services in Spanish and Mandarin.
Your Questions Answered About Insurance Settlements
If I get a settlement offer from the insurance company right after my accident, should I take it?
You should be extremely cautious of a quick settlement offer. This is a common tactic insurers use to resolve a claim before you know the full extent of your injuries and losses.
- A fast offer is almost always a lowball offer.
- You may not yet know what future medical care you will need or how long you will be out of work.
- Once you accept a settlement and sign a release, you can never go back and ask for more money, even if your condition gets worse.
Will my own insurance company treat me better if I have to make a claim?
Unfortunately, not necessarily. Even when you are dealing with your own insurance company for a claim (for example, an Uninsured/Underinsured Motorist claim, which applies when the at-fault driver has no insurance or not enough insurance), they are still a business.
What happens after we agree to a settlement? When do I get the money?
Agreeing to a settlement is the first step in the final phase. It does not mean a check arrives the next day.
Here is what typically happens:
- Signing the Release: You will sign a legal document called a release, which officially ends your claim in exchange for the settlement funds.
- Paying Liens: Before you receive your portion, any outstanding "liens" must be paid from the settlement funds. A lien is a legal right to payment held by an entity like your health insurer, Medicare, or a hospital that covered your medical bills. Your attorney will negotiate these liens down to maximize the amount you receive.
- Disbursing the Funds: After the legal fees and liens are paid, you will receive the remaining settlement funds. This process can take several weeks to a few months after the agreement is reached.