Understanding How Insurance Companies Determine Settlement Amounts

If you recently submitted a claim to an insurance company, you’ll soon encounter a claims adjuster. The adjuster determines the settlement amount after a thorough investigation of the accident and damages. 

Understanding how insurance adjusters determine settlement amounts can help you decide whether to counter, reject, or accept the offer. Here, we’ll discuss each of the factors that typically go into the decision, including the accident report, the claimant’s history, and the value of the damages.

The Accident Report

First off, the adjuster will likely gather information about the accident, including the policyholder’s firsthand account, any existing accident or police report, information from witnesses, etc.

Claimant History 

The adjuster also needs to ensure that the claim is legitimate by investigating the claimant. This can be done by combing through the insurance company’s database to check if the claimant has filed any claim in the past. 

The Value of The Damages

Next, the adjuster must determine the value of the damages to arrive at the settlement value. This process involves collecting all relevant documentation, including medical bills, proof of property damage, tax returns, proof of earnings, etc. The adjuster needs all the documents required to accurately value the case. 

To assign a value to the damages, the adjuster must consider the damages that can be precisely calculated, like medical bills and those that can’t, like pain and suffering compensation. 

For the most part, the adjuster will simply add the value of the damages that can be calculated, like medical bills and lost income. Remember that the adjuster may not include the total amount of a “soft” medical bill (i.e. one that mainly includes care from a physical therapist). To determine the value of the pain and suffering compensation, on the other hand, the adjuster will likely use specific tools or software. 

At Weldon & Rothman, PL, we can work to increase the value of your claim to ensure that you receive your rightful compensation. If your insurance carrier makes a low-ball offer, then we will advise you on your rights to file suit and to seek compensation through litigation. Reach out to us for a free case review