FAQ: How Does an Insurance Company Value my Claim?

When someone is severely injured - in an automobile accident, fall, or because of a hospital error, often the first step is a conversation with a representative of the insurance company.

The insurance company is, after all, in most cases the real decision maker.  Because the insurance company has the money, and often will decide whether to pay and how much to pay.

It's not uncommon for an injured person to consider trying to "work things out" with the insurance company on their own.  And in some cases, this can make sense.  If you have not sustained a particularly significant injury, or have made a very good, quick recovery, it may not be worth it for you to pay a lawyer to handle the claim. 

But if you or your family has suffered significantly, it will in most cases make much more sense to have an attorney involved, for a number of reasons.  Complex issues of liability and damages can come up, and an experienced lawyer can help you navigate the process and, in many cases can help maximize your recovery.  Remember, you only get one "bite" at the apple; once you settle your claim and sign a release, it's over.

So how does an insurance company actually value your claim?  

Clients often feel very strongly about their claims.  This makes sense - it is very personal to you and you have every right to be vested.  

But because of this, clients also often believe that the insurance company will recognize the intangible aspects of the claim.  The stress that it has caused the family, for example. 

Remember one thing - insurance companies do not make money by paying more than they should.  They make money by being relentlessly cheap; by paying as little as possible on as few claims as possible.  Their goal in every case is to save money.

How do they do this?  By being conservative.  

So what do they consider?

Real, verifiable damages.  Medical records and reports confirming the injuries; records of treatment for a specific injury; records confirming lost income as a result of the injuries; records of medical billing.

What about emotional distress?  

Insurance companies will consider the mental/emotional distress that an injury has caused to you or your family, to some extent.  They will consider it more significantly if you have received actual treatment for it.  If you tell them that you have been devastated, but they see photos of you on Facebook on the beach or out with friends, they will discount their evaluation.

The Bottom Line

Many insurance companies use software to help evaluate injury claims.  This software attempts to take the "human" component out of the equation, and only make payments based upon tangible information. 

For this reason it is critical that if you were injured, you do your best to document the injuries, your treatment and your losses.  While your own feelings about the loss are important, from the perspective of the insurance company the more documentation that you have, the easier it is for them to increase their offer. 

If you have questions about an accident or severe injury, contact us today.