6 Ways Insurance Companies Try to Reduce Your Personal Injury Settlement

Insurance companies are notorious for trying to minimize the amount of money they will have to pay out in a personal injury claim.

If you’ve been injured in an accident, knowing some of the most common tactics used by insurance companies could mean a big difference in your settlement amount.

Here are 6 of the most common ways insurance companies will try to minimize your personal injury settlement. 

1. Deny or Limit Liability

From the beginning of your case, the first question for an insurance adjuster will always be whether to accept or deny liability for your insurance company claim. This is based on a number of factors, such as:

  • police reports
  • witness statements
  • photographs
  • extent of injury

Many people will accept the denial and assume that there is nothing more that can be done. In reality, the first adjuster you speak with is not going to be the last. This first adjuster has the authority to deny the claim or go to a certain dollar amount in an effor
t to save the insurance company money. If you refuse to take “no” for an answer, chances are you will passed to another adjuster who has the real authority to settle the claim.

Do NOT take no for an answer and escalate the claim to someone with more authority.

2. Get You to Give a Recorded Statement

Insurance adjusters are trained to get a recorded statement of the victim as soon as possible after the accident. They will put you at ease and speak as though they’re your friend. 

But be careful because the objective of the adjuster is to

  • obtain harmful admissions as to how the accident occurred
  • get you to make statements that may hurt your case later on
  • minimize any complaints or injury and the need for medical care

For example, you may have broken your arm and hurt your neck in an accident, but the day after the crash, when the insurance adjuster calls you, the only thing that is bothering you is your broken arm. Later, after you have stopped taking the pain medications that they gave you at the hospital for your arm, you realize that your arm will heal, but your neck may not.

It is also common for the adjuster to take statements from people who have been prescribed heavy pain medications and who are not thinking clearly. Later the insurance company will use this recorded statement or notes taken by the adjuster to cast doubt on your personal injury claim. While you can attempt to go back in and amend your statement, it does not have the same impact as the first statement made.

In these situations, just thank the adjuster for calling and advise that you will not be making any recorded statements. Get their name, contact information and a claim number and give this information to your attorney.

3. Getting a Signed Medical Authorization


The adjuster would love to have you sign a general medical authorization giving them authority to request ALL your medical records from any medical providers you have ever seen. By signing this type of authorization, you allowing the insurance companies to fish for other past medical problems that could be used cast doubt on your current medical claim.  

If the insurance company asks for a signed medical authorization, don’t do it.  Do not sign any medical authorization forms furnished by the insurance company until you have spoken to an attorney. A properly tailored release done by an attorney should be used only after a claim has been submitted and it should only apply to medical records that are relevant to the current insurance company claim.

4. Offering a Quick Settlement

A very common tactic of insurance adjusters is to offer a quick, small settlement after an accident. Sometimes this offer will come before you have even had an opportunity to see a doctor or realize your need for
medical care. Many times a person does not even begin to feel the effects of an accident until DAYS afterward. Accepting a sum of money and signing a binding release before you know your damages could be detrimental, but it happens all the time. Shannon Kmatz, a former claims adjuster for Allstate, told CNN that she would
offer as little as $50 dollars in some cases. Poor people would take it, she said, fearing that if they didn’t, they’d get nothing at all. Once you have signed a binding release, you cannot go back and ask for more money.

5. Convince You Not to Hire a Personal Injury Lawyer

Insurance adjusters will be the first to tell you that an attorney will only cost you money and take all of your potential settlement. But when an insurance company tells you not to hire an attorney it is for one reason: to save the insurance company money. They realize that claims settle for greater amounts when clients are represented by counsel. In addition, attorneys will take your personal injury claim case on a lien basis, so while you will have to pay a percentage of your recovery, you are typically not spending anything on the case until it settles, so an attorney does not cost the client more. Furthermore, insurance companies know that you have probably never placed value on a personal injury claim and have never negotiated on your own. This does not put you on a level playing field, and they know this.

6. Put You on Surveillance


Insurance companies are notorious for trying to make a legitimately injured person appear healthy. If you drive your kids to school, drag your garbage can to the curb, or do some yard work, this does not mean that you are not going to be in pain later as a result. Many injured people have to continue to conduct their normal activities, even while injured, and these normal activities can appear detrimental if skewed by an adjuster. Therefore you almost have to assume that you will be under surveillance at some point if you have suffered a significant injury. Adjusters hire investigators to photograph injury victims in hopes of catching them doing something inconsistent with their injuries.

If you have been in an automobile accident, it is important to know these tactics and consult an attorney if you feel you are being taken advantage of by an insurance company.

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