After an accident or injury, receiving a settlement offer from an insurance company might seem like a relief. But according to personal injury attorney Chris Mova, consumers often miss critical factors when evaluating these offers.
“Insurance companies are in the business of making money, not maximizing payouts,” explains Mova, founder of Mova Law Group, a law firm in California specializing in personal injury cases. “Their initial offers are typically calculated to save them money, not to fully compensate you for your injuries.”
Based on Mova’s insights, here are key considerations that consumers frequently overlook when evaluating settlement offers.
1. Future Medical Expenses
The most common oversight is failing to account for future medical needs. “An injury that seems manageable today might require ongoing treatment or even surgery down the road,” Mova points out. “Once you accept a settlement, you can’t go back for more money if your condition worsens.”
Before accepting any offer, consult with medical professionals about potential long-term complications and treatment costs. Get written opinions if possible, as these can strengthen your negotiating position.
2. Lost Earning Potential
Settlement offers often address immediate lost wages but fail to account for diminished earning capacity. “If your injury affects your ability to perform your job or advance in your career, that represents a significant financial loss over your lifetime,” says Mova.
This is particularly important for younger victims or those with physically demanding jobs. Consider how your injury might impact your earnings five, ten, or twenty years from now.
3. Pain and Suffering
Insurance companies typically use formulas to calculate pain and suffering damages, but these formulas rarely capture the full impact on your life. “There’s no standard formula that accurately reflects how an injury affects your daily activities, sleep, relationships, and overall quality of life,” Mova explains.
Document how your injury has changed your daily routine and activities. Keep a journal noting pain levels, limitations, and emotional impacts. This documentation can be powerful evidence for negotiating a more appropriate settlement.
4. Timing Tactics
Be wary of pressure to accept an offer quickly. “Insurance companies often push for rapid settlements before you fully understand your injuries or consult with professionals,” Mova warns. “This urgency typically benefits them, not you.”
Take the time you need to understand the full extent of your injuries. Most states have statutes of limitations that give you years to file a claim, so don’t let artificial urgency drive your decision.
5. Comparative Settlements
Insurance adjusters rarely volunteer information about what similar claims have settled for. “Knowing the ‘market value’ of comparable cases can dramatically change your perspective on whether an offer is fair,” says Mova.
While every case is unique, an experienced attorney can provide insight into settlement ranges for similar injuries in your jurisdiction.
6. Subrogation and Liens
Many consumers don’t realize that accepting a settlement might trigger obligations to repay health insurance, Medicare, or other entities that covered their initial medical expenses.
“There have been cases where clients were shocked to learn that much of their settlement would go to satisfying medical liens,” Mova notes. “Understanding these obligations before accepting an offer is crucial.”
The Bottom Line
Insurance settlement offers require careful evaluation beyond the face value of the check. “What might seem like a generous offer in the moment could be grossly inadequate for long-term needs,” which Mova can speak to from personal experience.
His advice for consumers: “Take a breath. Don’t sign anything immediately. Seek medical attention first, then consult with a legal professional who can help you understand what your claim is truly worth.”