Whether your case involves a car accident, slip and fall, product liability, medical malpractice, or another type of personal injurya accident, you may have suffered significant losses. Those losses may include medical expenses, lost wages, pain and suffering, and more. What can you do, and where can you turn for help?
When you file a personal injury lawsuit, you seek damages to recover from the losses sustained in your injury. Financial compensation is a way to help you recover and resume your life. The primary purpose of a personal injury claim is to return the injured party to the position that they were in before the injury.
Unfortunately, the lawsuit process can take a significant amount of time. Before a trial begins, there are investigations, pre-trial motions, insurance claims, medical evaluations, and more.
Many accidents result in significant injuries, expenses, and lost wages, so victims often feel anxious about when they can expect to receive a personal injury settlement check for financial losses.
It is a relief when a lawsuit concludes, and you finally receive a settlement check. However, as you anxiously await your settlement check, you may have questions about the personal injury claims process, settlement check timeline, and why your personal injury lawyer is holding your settlement check.
What Is a Legal Settlement?
According to the Bureau of Justice, only 4 percent of personal injury cases go to trial. The majority settle out of court bymutual agreement between the parties. This resolution is called a settlement.
Asettlement is an agreement that ends a dispute and results in the voluntary dismissal of any related litigation. It may happen during the early stages of litigation, or in some cases, even before the injured person files a lawsuit. Settlements usually occur when the defendant and the plaintiff agree to the personal injury claims rather than going to trial.
As part of the settlement, the defendant must pay the plaintiff compensation for resulting losses. However, the parties may have very different perspectives on the case. They may disagree about issues of fault or the amount of payment warranted.
The question is whether to accept a settlement offer or continue to litigate the case, potentially proceeding to trial. Insurance companies often offer a low initial amount, hoping for a quick settlement. You should not agree to a settlement or sign anything with the insurance company without having an experienced personal injury lawyer in your corner.
For both parties, there are potential advantages and disadvantages to settling the case. By settling, both parties know the terms of the agreement and avoid the unpredictability of a trial. A settlement allows both parties to resolve the matter more quickly. The settlement is not final until the plaintiff or the plaintiff's attorney receives the check and it clears.
The defendant may lack the money to pay a judgment. The settlement terms typically remain confidential, as opposed to public trial results. Attorney's fees and expenses may amount to less. However, some plaintiffs prefer to go to trial because they may receive a higher award of damages from a jury than in a settlement, or they simply want their day in court.
If you choose to settle your case, you do not immediately walk out with a check. Your check is part of a legally binding agreement. Each case is different, but specific key steps are involved in the settlement check process.
Signing the Essential Documents and Release Forms
If both parties agree to a settlement agreement before trial, the lawyers will report the settlement to the court. Next, the court issues an Order of Settlement. This order generally requires that both parties complete all necessary paperwork within either 30 or 60 days. The most important settlement document is the release. This document absolves the other party of any further liability.
The attorney for the defendant prepares a release form, which should clearly and accurately outline the terms and conditions of the settlement. Release forms generally state that the injured person will not pursue additional compensation from the party liable for the injuries. The release can be short or long, depending on the circumstances of your case and the settlement terms. Most insurance companies require specific terms in their releases, and some states also may require specific language.
However, most release forms cover three main points:
- You release the defendant and their insurance company from further liability. Even if you later find you have additional injuries or losses, there will be no further compensation for the claim once you have signed the release.
- The defendant and his or her insurance company do not admit fault, even though they are paying the claim.
- You release the defendant and the insurance company from any other claim for the related incident. This means you give up the right to file another claim for additional damages in the future.
The plaintiff's attorney reviews the release to ensure that all of the terms and conditions are correct. If there is a dispute, the attorneys will attempt to negotiate. If the attorneys cannot agree, a judge or jury will resolve the issue at trial, which may slow the process down.
Before signing, when you receive the release, read it carefully and ask your attorney to review it for concerns. You then sign the form in the presence of a notary public, which acknowledges that the signature on the document is your own, that you willingly made it, and that the provisions in the document take effect exactly as written. Once you have signed, you cannot change the terms, negotiate further, or pursue other legal action regarding the occurrence. Next, the insurance company receives the document, along with the defense attorney.
In some cases, the settlement agreement requires the plaintiff to sign a confidentiality clause, also known as a non-disclosure agreement, as part of the release. This means the plaintiff must keep any settlement amounts or other matters private. The defendant may want this clause to protect a company's reputation for safety or trustworthiness, or a high-profile defendant may not want the settlement to become widely known.
The Insurance Company Releases the Check
The at-fault party's insurance provider is usually responsible for paying the settlement amount. This insurance company processes the release and has a legal obligation to write the settlement check as soon as it receives your release, but internal issues may slow this process.
Some states have deadlines for when the defendant must provide the settlement funds after receiving the release form. Some laws may require interest on the funds from the date of the receipt of the release form, which provides an incentive for the defendant to pay promptly. Insurance companies have strict internal procedures for issuing checks. The company's internal procedures control who will review your settlement agreement, make sure the release form is proper, legally protect the insured and the company, and then send the authorization to another department to cut and mail your check.
In most cases, the company will make this check payable to both you and your attorney. The insurance company sends the check to your attorney, who needs to deduct certain funds before you can receive your money.
The Check Arrives at Your Attorney's Office
Once the check from the insurance company arrives at your attorney's office, the attorney deposits the check into an escrow account. This ensures that it has the funds to cover the check, so it remains there while the bank clears the check. Once the check clears in the escrow account, your attorney can begin to disburse the funds.
Your attorney will have to pay any outstanding liens. These are anypending debts you may owe to certain entities related to either your case or another charge against you. Your attorney must pay these unsettled liens out of your settlement funds before releasing the check. Your attorney pays these first because if they don't get paid, the creditors can bring a civil suit against you.
Liens may include:
- Unpaid medical bills related to your injury;
- Unpaid child support; and
- Unpaid attorney's fees—for example, money owed to an attorney who provided legal services but was discharged.
Before hiring your attorney, you should have reviewed and signed a payment agreement. For personal injury cases, this is usually a contingency fee arrangement, which means the attorney's legal fees are a percentage of the compensation if awarded. Your attorney will deduct his or her share from the settlement funds for the legal services that he or she provided and for any expenses that they advanced for the case, such as costs for filing fees, accident reconstruction, gathering and preserving evidence or medical records, expenses related to discovery, expert witnesses, and other services necessary for trial preparation.
Full and Fair Compensation
You need to feel confident that you receive full and fair compensation for all of your injuries and losses before signing the agreement.
An experienced personal injury lawyer can help you assess the amount and extent of your losses, but you need to understand the full cost of your injuries, too.
Here are some factors that you need to consider when evaluating a settlement offer:
- Your medical bills
- The length of your medical treatment
- Your lost income and the loss of the ability to ever return to work or the same job
- Any ongoing or long term treatment that you may require
- Your long-term diagnosis
- Your pain and suffering, now and in the future
Payment options are another important consideration. You need the settlement funds to pay bills and possibly replace your income. You may choose to receive your compensation as a single large sum. That means that the claimant will receive the total amount of the settlement proceeds in one lump sum payment.
Alternatively, you may receive your compensation as a series of periodic payments in the form of a structured settlement, which are usually paid through annuities owned and administered by life insurance companies. Structured settlement annuities are usually tailored to fit individual needs, taking into consideration the amount and frequency of payments as well as other factors. Once agreed upon, you cannot change the terms.
Potential Delays in Receiving a Settlement Check
The time it takes to receive a settlement check varies from one case to another.
Delays happen because:
- There is a dispute regarding the release form.
- The case involves a minor or an estate.
- Your attorney is negotiating the amount of a lien.
- The settlement and release agreement was not properly signed and returned.
- An insurance office in one state processes the claim, and an insurance office in another state issues the check.
- The claims adjuster in charge of your case may have left due to a vacation or unexpected illness, and therefore, did not forward your documents for the necessary approval.
- The supervisor responsible for signing off on your agreement is unavailable.
- Clerical errors.
Is It Possible to Expedite the Process?
Once you have signed the completed release, it generally takes about six weeks to receive a settlement check; however, it can also take much longer. The timing depends on the defendant's policy, the type of personal injury case involved, and other circumstances.
The fasted way to bring your case to the best conclusion for you is the hire of an experienced personal injury lawyer.
Your attorney may expedite the process by preparing and providing you with the necessary documents. You should review these documents carefully and return them promptly. If you have any questions or concerns, do not hesitate to ask. Liens may slow down the settlement check process. You may wish to discuss certain liens with your attorney to speed up the resolution of these debts.
You Receive Your Settlement Check
Completing the settlement process requires close attention to detail. After your attorney has deducted all liens, fees, and expenses, he or she will write you a check for the remaining amount of your settlement. You may wish to consult a law firm and a personal injury attorney to determine the tax consequences, if any, of your settlement money. Now you can begin your financial recovery and plan your post-injury life.
For more information about personal injury claims or a free consultation, you should contact an experienced personal injury attorney today. We offer a FREE initial review so you can seek legal counsel and get the answers you need.