People acquire insurance policies to protect themselves from financial responsibilities in case of a crash. While it is true that insurance providers pay for the damage expenses of an accident depending on specific circumstances, they often employ several tactics to reduce your car accident settlement.
When dealing with car accident settlements from insurance companies, you must understand the seven ways insurance companies may reduce your payout and learn how to navigate around them.
How Does Insurance Work in Car Accident Claims?
If another driver hits you, you may file a car accident claim to receive compensation for the damages. When you successfully prove your case, the at-fault driver’s insurance provider pays for the damage expenses you incur from the crash, such as medical bills and lost wages.
Usually, drivers in California have minimum insurance requirements, as the state requires all drivers to have one before operating a vehicle. This includes:
- $15,000 for injury or wrongful death of one victim.
- $30,000 for injury or wrongful death of more than one victim.
- $5,000 for property damage.
However, it is essential to note that you can only file a car accident claim if you can justify that the other driver’s actions or negligence caused the accident. You can do this if you have sufficient proof to demonstrate the elements of negligence:
- The driver was responsible for protecting everyone’s safety.
- They failed to fulfill this duty.
- The breach of duty resulted in an accident.
- The accident caused injuries and other damages.
You may ask, “What evidence can prove a car accident?” Several types of evidence can be used to justify a driver’s negligence, such as:
- Images from the scene of the accident
- footage from surveillance or dash cameras
- Testimonies of witnesses
- police statements
- medical records, including hospital expenses and diagnoses
What Happens If I’m Hit By a Hit-and-Run Driver?
Suppose the at-fault driver attempts to flee the scene. In that case, the authorities must locate them using evidence such as the driver’s physical description as reported by a witness or their vehicle plate number. If authorities find the driver, you can file a claim against them.
However, if officers can’t locate the driver, you can still receive a car accident settlement from your insurance provider. You can use several insurance policies, such as your uninsured motorist coverage, health insurance, MedPay, and others.
How Much Will I Receive from a Car Accident Settlement?
Accident settlements for car accidents base the value on the damages applicable in the situation and how these impact your life. For example, if you sustain minor lacerations from a crash, your compensation may be lower compared to a victim with permanent back injuries.
After calculating the total damages, your lawyer will negotiate with healthcare providers and other companies that cover your treatments and damage expenses. The medical costs, vehicle repair expenses, and other expenditures will be deducted from your car accident settlement.
Your lawyer will also take a certain percentage from your payout as a payment for their services. You will finally receive the remaining amount from your car accident settlement when every expense is paid.
This is why maximizing your payout by determining the total damages and minimizing your damage costs is crucial. However, this does not mean that you should cut your treatment. Instead, you should understand the loopholes insurance providers make to reduce your settlement and contact an experienced California auto accident attorney who can defend your rights.
7 Ways Your Insurance Company Might Be Reducing Your Car Accident Settlement
Insurance providers may not always have our best interests at heart. They often quickly offer a settlement that hardly compensates for the total damages you sustain from the accident. Aside from this, several loopholes may hinder you from maximizing your car accident settlement.
Network Coverage
Insurance companies often have a network of preferred providers, including doctors and hospitals, with whom they have negotiated rates. If you seek treatment outside this network, the insurance may cover a smaller percentage of the costs or none at all.
Hence, it is crucial to check if your treatments are in-network. Sometimes, some specific providers or hospitals aren’t covered by your insurance. Unfortunately, paying significantly higher out-of-pocket costs for out-of-network services can reduce the settlement you will be receiving.
For example, you may have surgery for your leg injuries. After the procedure, you may discover that the anesthesiologist was not covered, so you need to cover that specific cost.
Note that out-of-network providers and institutions must notify you within 72 hours that they fall into this category and provide a realistic pricing estimate.
Facility Coverage
Like network coverage, facility coverage indicates that your insurance plan may only cover services at specified hospitals or clinics. You may have to pay additional fees if you require specialized therapy that is not provided at these facilities.
This restriction can result in higher medical expenses if the necessary therapy is only offered at non-covered facilities, reducing the amount you receive from your car accident settlement. This is why it is crucial to verify if the facility you are having your treatments is an in-network facility.
You should be notified within 72 hours if a facility is not in-network. However, if you urgently need medical treatment, you may not have time to switch to an in-network facility. This is why taking these measures ahead of time is the most effective approach to protecting yourself.
Location-Based Costs
Insurance companies may alter reimbursement rates based on the cost of living or average medical costs in different geographic areas. Services in metropolitan locations may be compensated less than in rural areas or vice versa. Similarly, the same procedure by the same provider might cost more at a hospital than in an office. If a hospital buys your provider’s practice, costs may increase.
Your insurer may pay rates based on lower-cost areas even though your accident happened in a high-cost area, leaving you with high uninsured costs that will diminish the overall amount of your settlement. It is best to check the location-based costs to maximize your payout.
Balance Billing
When a healthcare practitioner bills you for the difference between what they charge and what your insurance covers, this is known as balance billing. For instance, you might be responsible for the remaining $50 if a doctor bills $300 for a service and your insurance only covers $250.
Services provided outside your network may also result in balance bills that are not deducted from your deductible, increasing costs. These actions may result in unanticipated medical expenses that your settlement needs to cover, lowering the total compensation you get paid for accident-related expenses.
Symptomatic vs. Disease Therapies
Insurance policies may make a distinction between symptom-addressing and disease-treating treatments. Specific plans may restrict coverage to symptomatic treatments only, resulting in less comprehensive coverage and, ultimately, higher costs.
The total benefit from your settlement may be limited if you are required to pay out-of-pocket for more efficient disease-targeted therapy if your insurance only covers symptomatic treatments.
Preventative vs. Diagnostic Services
Insurance companies may pay less for diagnostic services like blood tests or MRI scans that diagnose conditions and more for preventative services like immunizations and regular checkups. You may require costly, non-covered diagnostics following an accident.
Insufficient coverage for diagnostic services may result in increased out-of-pocket expenses for essential examinations and treatments, reducing the capacity of your settlement to compensate for all incurred costs.
Non-Insurance Plans
Certain insurance companies provide restricted coverage choices or discount plans with lower rates but much less coverage than regular insurance.
After an accident, you may have significant out-of-pocket expenses due to these policies’ partial or complete exclusion of specific forms of treatment, which lowers the total settlement amount you can spend.
Each strategy can reduce your compensation because you may incur more out-of-pocket expenses that your settlement must cover. Understanding these strategies can assist you in better negotiating with your insurer or preparing for increased charges.
If you hire a California auto accident attorney, they will also help you obtain the appropriate treatments and negotiate with healthcare providers to increase the remaining amount you will receive from the car accident settlement.
What Damages Can Be Included in Accident Settlements for Car Accidents?
You can generally claim compensation for medical costs and property damage resulting from the accident. However, an auto accident attorney can help maximize your settlement by identifying all applicable damages, including those related to the specific circumstances of your case.
| Economic Damages (financial losses) | Non-Economic Damages (non-monetary losses) |
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Calculating economic damages is relatively simple, but valuing non-economic losses is more complex. California’s leading auto accident attorneys possess the expertise to assess and quantify non-monetary damages accurately, ensuring you receive the highest possible compensation.
These legal experts can also review your personal injury case to determine if you qualify for punitive damages.
Lawyer’s Tip: You can also contend for punitive damages if the actions of the at-fault driver are intentional or extremely malicious. However, only the court imposes such damages. A lawyer can help you determine if you are eligible for punitive losses to maximize your payout.
How Can a California Auto Accident Lawyer Help Me?
While it is true that you can file a claim independently, this is not usually the best choice, as insurance providers always try their best to reduce car accident settlements. For instance, they may try to settle a claim to avoid paying for further damages quickly.
This is why hiring a California auto accident attorney who can determine the total damages and negotiate for fair compensation is crucial. They can also do the following to win your claim:
- Gathering crucial evidence to support your case.
- Establishing liability.
- Calculating the full range of damages.
- Negotiating with the insurance company.
- Taking the case to trial if necessary.
Claiming accident settlements for car accidents may be challenging. Fortunately, Jacoby & Meyers offers some of the most skilled and dedicated personal injury attorneys committed to ensuring you receive the justice you deserve. While many firms handle accident compensation, Jacoby & Meyers stands out for its unwavering commitment to protecting your rights, making it a top choice for accident victims.
Since 1972, Jacoby & Meyers has consistently advocated for the legal rights of individuals involved in accidents, achieving substantial settlements. Our impressive track record, with over $2 billion in settlements, underscores our dedication to our clients.
If you’ve been injured in a car accident, Jacoby & Meyers is here to help. We provide free consultations for injury victims and operate on a contingency fee basis.
Jacoby and Meyers. Because You Deserve Justice.
Hear From Our Past Clients
Instead of taking our word for it, listen to what satisfied clients say about our services.
“So far, my experience has been great. I have been reassured constantly that I will not have to pay medical fees, and they immediately took care of my property damages after my accident. Karina is my case manager and has been on top of things for me.” – Christian Arguello.
Frequently Asked Questions
Do you have further questions regarding personal injury claims? We got you! Here are some frequently asked questions from injured victims that may help explain some aspects of your case.
- Can I Still File a Claim If I Have an Unfavorable Police Report?
- Can I Receive a Settlement from an Accident in California after I Sign a Liability Waiver?
- My Personal Injury Settlement Check is Late; How Long Will It Take?
- When Will I Start Getting Paid from My Car Accident Settlement?
Works Cited
“Auto Insurance Requirements – California DMV.” California DMV, https://www.dmv.ca.gov/portal/vehicle-registration/insurance-requirements/. Accessed 11 June 2024.
Donovan, Caitlin. “Insurance is full of loopholes – here are the top ones to avoid.” National Patient Advocate Foundation, 1 August 2021, https://www.npaf.org/blogs/insurance-is-full-of-loopholes-here-are-the-top-ones-to-avoid/. Accessed 11 June 2024.
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