It’s no secret that insurance companies are in the business of making money. They are known for caring more about their own bottom line than properly compensating claimants. Consequently, low-ball settlement attempts are common. That’s why it is so important for anyone filing a personal injury claim to understand how the settlement amount is calculated—and the tricks that insurance companies pull in order to justify a low settlement offer. 

Factors That Determine a Settlement for a Personal Injury Claim

Unfortunately, the law does not specify a particular method for calculating the amount you’re owed in a personal injury case. To estimate the value of an injury claim, insurance companies use a mathematical formula as a starting point for their negotiations, which is based on a combination of factors, including:   

• Severity of Injuries: The more severe your injuries, the higher your settlement should be.
• Cost of Medical Care: This includes past, current, and future medical expenses.
• Lost Wages: Compensation for the time you couldn’t work due to your injuries.
• Pain and Suffering: Non-economic damages that compensate for the physical and emotional distress caused by the injury.
• Future Medical Expenses: Any ongoing treatment or rehabilitation needed.

Having thorough documentation and evidence in each of these areas is essential to support your claim. 

You must also consider the impact of legal representation on settlement offers. Studies have shown that insurance companies offer claimants significantly more—sometimes three times as much—if they are represented by an attorney. This is because they know attorneys can accurately assess the value of a claim and are prepared to take the case to court if necessary.

Common Tactics Used by Insurance Companies to Low-Ball Settlements

1.     The Tap and the Gap

Insurers commonly argue that if you didn’t seek treatment immediately after the accident, you must not have been seriously injured. Insurance industry insiders refer to this theme as “the tap and the gap”, referencing a minor impact and a delay in seeking medical care to downplay your injuries. Needless to say, if you’re reading this after an incident and haven’t yet sought medical treatment…do so immediately. 

2.     Equating Lack of Vehicle Damage with No Injury

In motor accident cases, insurance companies often claim that minimal damage to your car means you couldn’t have been injured. This ignores the fact that even fender benders can cause significant injuries. Pay attention to your body and remain aware of any symptoms such as back and neck pain, behavioral or emotional changes, numbness or tingling in your limbs, headaches, and abdominal pain. 

3.     Social Media Surveillance

Insurers are known to scour your social media to find photos or posts about you doing everyday activities like hiking, swimming, vacationing, or working out. They use this as evidence to argue you weren’t injured, even if the activity was only for a brief moment or unrelated to the injury. Be cautious about what you post online while your claim is pending. 

4.     Assigning Fault to the Plaintiff

Another strategy is to try to place partial or full blame on you, the claimant. In personal injury claims, the law permits the judge or jury to consider the fault of each party involved. Known as “comparative negligence,” a victim who is proven to be partly responsible for the incident that led to harm can only recover part of their damages. 

5.     Manipulating Medical Records

Insurance companies will read medical records literally to exploit general language. For example, if you tell your physical therapist you feel “okay,” they’ll argue you weren’t injured after that day. It’s essential to be precise and consistent when describing your pain and limitations. In addition, they will dig into your history to find prior injuries, such as past car accidents or sports injuries, and pin your current injuries on those pre-existing conditions.

Recognizing a Low Settlement Offer

Because there are so many variables involved in determining how much a settlement for a personal injury claim is truly worth, it’s hard to know what precise number is “fair.” 

Indicators of a low settlement offer may include:

• Offers significantly lower than your medical bills and lost wages.
• Ignoring non-economic damages like pain and suffering.
• Quick settlement offers without thorough investigation.

If you receive a low-ball settlement offer—or want to avoid it in the first place—Kane Personal Injury can help. As your advocate, we will gather evidence, evaluate the true value of your claim, counter common insurance company tactics, and negotiate on your behalf. It’s our job to get you the compensation you deserve. Contact Kane Personal Injury today for a free consultation.