How Are Car Accident Settlements Paid?

The Car Accident Settlement Process in Illinois

Understanding the car accident settlement process in Illinois can help you get fair compensation. The settlement process can be long and tedious, so getting experienced car accident lawyers involved is advisable. The following steps you will make you much likelier to receive a reasonable settlement after a car accident:

Seek Medical Attention

After an accident, ensure you seek medical attention, even if you suffered minor injuries. The medical provider will check if you suffered internal injuries that could be life-threatening in the future. The provider will then document your injuries and enroll you in an appropriate treatment program. Ensure you keep all the medical records and receipts, as they are essential evidence for your claim.

Report the Accident

Illinois law requires you to report the accident to the police if it causes death, injury, or property damage. The police will help investigate the cause of the accident and prepare a report. You must file a crash report with the local transportation department within ten days after the car accident if the police fail to come to the crash scene. Be sure to get a copy of the police report.

Gather Evidence

Collect enough evidence at the accident scene, as this will increase the chances of getting compensated. Take photos of the accident scene from different angles, and remember to take witness statements and contact and insurance details from the other driver. You can involve your lawyer if you don’t know how to document your car accident injuries.

Notify Your Insurance Company

Most insurance companies require policyholders to notify them after an accident. Failing to notify your insurance company can hurt your car accident claim. Don’t forget to submit a copy of the police report and videos and photos of the scene as proof that an accident occurred.

Investigate

It’s advisable to perform an independent investigation instead of relying on the insurer’s investigation alone. The reason is that most insurers don’t have your best interest in mind and don’t want to lose their money on settlements. If you challenge the insurer’s conclusion, your lawyer’s investigation will provide enough evidence detailing why the demanded amount is valid.

Determine Your Damages

Make sure you calculate economic and non-economic damages caused by the car accident before negotiating a settlement. Your lawyer should include all financial expenses, both monetary and non-monetary. Remember to calculate the lost wages if you failed to work because of the accident. Some injuries may require seeking future medical attention, so you must include the estimated future treatment cost.

While it’s easy to calculate the value of economic damages, it can be challenging to determine the value of non-economic damages. In these instances, your lawyer can use the multiplier formula and consult with professionals like financial planners and medical practitioners. The lawyer will also consider average typical pain and suffering settlements when calculating the value of your claim.

File a Claim

If you’re sure the other driver was at fault, filing a formal insurance claim is advisable. The at-fault driver’s insurance includes a third-party policy that covers the damages incurred after an accident.

The insurance company will then get an adjuster to investigate the claim, check the evidence provided, and assess the extent of damages. The adjuster can ask questions while investigating the claim, so you should cooperate. However, liaise with your lawyer before answering any questions. The lawyer will protect you from giving a statement that can jeopardize your case.

Conduct Settlement Negotiations

After the insurance company completes its investigation, it can approve or dismiss your claim. If it approves the claim, it will make a settlement offer based on its assessment. You’re allowed to accept, negotiate, or reject the offer.

When conducting settlement negotiations, you or the at-fault party can request mediation. The mediator doesn’t make decisions, but guides the conversation to ensure both sides communicate effectively.

In case you decide to negotiate for a fair settlement, your lawyer should provide all the evidence collected during the investigation. The evidence should be detailed and demonstrate why the insurer’s offer should be reviewed. Once both parties agree, the insurance company can decide to pay one lump sum or pay in installments over a stipulated period.

File a Lawsuit

There’s an option to file a lawsuit if the parties involved in a car accident settlement disagree. If you decide to go to court, your case will go through the discovery phase. The discovery process allows involved parties to exchange evidence through different legal tools.

Your lawyer can, for instance, send the at-fault party a document that requires the at-fault party to deny or admit liability. Your lawyer can also prepare relevant questions he or she wants the other party to answer. The at-fault party can respond or provide an objection.

Your lawyer can ask the at-fault party’s defense lawyers to produce copies of their investigation report for your lawyer to inspect.

After the discovery phase, both parties will present their evidence in court. After the hearing, the judge will outline his or her findings and issue a verdict. If the judge rules in your favor, the insurance company will be instructed to pay a certain amount as compensation.

So, how long does a car accident lawsuit take? The unique fact and circumstances of your case will determine how long your lawsuit will take.

Are There Different Methods of Payment for Car Accident Settlements?

In Illinois, most accident settlements are made through lump sum payments or structured settlements. The type of payment you choose depends on the severity of your injuries and your settlement agreement.

Lump Sum Payment

As the name suggests, this payment method involves making an all-inclusive, one-time payment to settle the claim. This kind of compensation is ideal for victims who won’t need long-term medical treatments. The amount paid covers all expenses, such as property damage, pain and suffering, medical expenses, and other related expenses.

It may take several months before you receive a lump sum payment. This is especially the case if the defendant wants to negotiate the claim. After negotiations, the involved parties sign the settlement agreement. You will then receive the car accident settlement within six weeks. Remember, once you sign the settlement agreement, you cannot seek additional funds related to the car accident.

Some advantages of lump sum payment include immediate access to funds, certainty, and closure. This is because you receive your compensation at once and can pay the medical bills and vehicle repair expenses. You will get closure and move on, as ongoing negotiations and court proceedings can be physically and emotionally draining.

Structured Settlement

Unlike the lump sum payment option, a structured settlement involves paying the compensation in installments for a stipulated period. Structured payments for car accident cases are tax-free, allowing you to have a regular source of income with tax benefits. The defendant can pay you from personal funds or auto accident insurance.

For a structured settlement to work, all parties must agree on the total compensation and how the defendant will make payments. After signing the agreement, the insurance company will buy an annuity from another third-party provider to fund the settlement. This arrangement ensures that you receive the installment as agreed. You can either receive a fixed amount or increase the payments over time.

You can choose this payment option to cover your living expenses, ongoing medical costs, and rehabilitation. Additionally, a structured settlement will protect you from spending the money irresponsibly.

What Is the timeframe for Receiving a Settlement Payment?

There is no specific timeline for receiving a settlement payment, as many factors must be considered. How soon you receive payment depends on several factors, including the type of settlement, the complexity of the case, and the responsiveness of all involved parties.

For example, you will need to negotiate with the defendant after filing an auto insurance claim. In this phase, both parties will take some time to review the case and then sign the agreement. Some cases take a few days to negotiate and review, while others need several weeks.

If you involve the court, you will need its approval to continue with the settlement. Depending on the court’s schedule, this phase can take several weeks or months.

Another factor that affects the timeframe for receiving a settlement payment is the process followed to disburse the funds. After signing and approving the settlement agreement, the insurance company will process the payment. This should be done within 30 days after the agreement is finalized.

There are instances where the defendant delays processing the accident claim amount. This usually happens if the settlement involves liens, like the Medicare liens, which must be resolved before the accident claim amount is disbursed.

Once everything is resolved, your car accident settlement lawyer will receive the funds from the at-fault party and deposit them into a trust or escrow account. The lawyer will then pay any outstanding legal fees, liens, and expenses from this amount. You will then be given the remaining amount. Depending on the agreed settlement payment structure, this process could take a few days to several weeks.

Factors Affecting Settlement Payments

Several factors can affect settlement payments in Illinois. Insurance companies and lawyers must review the accident specifics to determine the compensation amount. Here are the most common factors that affect settlement payments.

Comparative Negligence Rules

There are specific negligence rules put in place by the Illinois government that help assign liability to parties involved in an accident and determine compensation amount. The insurance companies and lawyers will investigate the degree of negligence that every involved party contributed to the car accident.

Under the Illinois modified comparative negligence rule, you won’t be compensated if you are more than 50% responsible for the accident. However, if you are only 30% responsible for the car accident, your compensation will be reduced by 30%.

Insurance Policy Limits

The insurance policy limit is another factor that affects car accident settlements. Most insurance companies will not compensate for the accident more than the amount agreed in the policy terms.

Illinois law mandates two types of insurance coverage. The first is auto liability coverage, which requires a minimum liability coverage of 50/25/20. This means one will receive $50,000 for bodily injuries in each accident, $25,000 for each injured person, and $20,000 for property damage.

The second option is Underinsured/Uninsured motorist coverage. This option only covers bodily injuries from an accident caused by a driver with insufficient or no insurance coverage.

The Damages Caused

The average claim you make should align with the damages caused. Ensure you check the severity of injuries, loss of wages and future earnings, medical expenses, and pain and suffering caused by the accident. Remember, some injuries may require you to seek future medical treatment, so you must include the estimated treatment cost.

The car accident settlement process can be quite tedious, but the results will be worth the effort, especially with a car accident lawyer on your side. You can get paid using a structured settlement approach or a lump-sum payment approach.You can count on Strong Law Offices in Peoria and Chicago, Illinois, for personalized and committed legal support if you have suffered injuries in a car accident. Contact us today for a free consultation.