Legal Needs For Settling Car Insurance Claims

Legal needs for settling car insurance claims include hiring a lawyer if your insurance supervisor is unresponsive. However, a lawyer is entitled to a percentage of your insurance claim settlement.

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Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...

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Reviewed by Joel Ohman
Founder & CFP®

UPDATED: Jun 4, 2020

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Here's what you need to know...

  • There is a time limit on filing a claim
  • There is a time limit for the insurance company to settle the claim
  • You can hire a lawyer, but he will be entitled to a percentage of you settlement

Dealing with insurance companies can be very difficult, especially when there is a claim involved. Often times you should seek legal advice before settling a claim.

You may not keep track of the amount of time to settle an insurance claim. Once that time is up you are no longer allowed to negotiate. So make sure you find out what you need to do to settle your claim.

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How long do I have to settle an insurance claim?

The insurance company is also regulated by the established time frame. It must complete its investigations and paperwork within a certain amount of time.

Insurance companies must also notify you of the settlement amount by the established deadline.

Each state has a different requirement for how long you have to settle an insurance claim. You should always check what the time limit is for your state.

You can find this information out on the National Association of Insurance Commissioners website.

Unfortunately, your insurance agency probably cannot give you an exact timeframe as to how long it is going to take to settle your claim.

It can only give you an estimate because each claim is different. Rarely does the insurance company tell you the time limit it is required to follow.

You should not take the relaxed approach when settling a claim. You should always be proactive to ensure you receive the best service possible:

  • Call your claims representative on a regular basis. Have them send email documentation of the claim’s status so that you have written proof of how the claim is being handled. This will also come in handy if you do end up retaining an attorney
  • If your claim is not being handled fast enough or in a way you deem to be satisfactory, ask to speak to a supervisor. Remember it is their responsibility to save their company money, not look out for your needs

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When should I seek the advice of an attorney?

You should seek the advice of an attorney if you feel like the claims adjuster or the supervisor is not responding to your inquiries. You should warn the representative that you will be contacting a lawyer.

If the response is no different, find a lawyer to represent you.

You should seek the advice of an attorney if you feel the settlement amount is too low or incomplete. An attorney can review all of the documentation to help determine an accurate settlement amount.

The attorney can also fight for you to get an amount that you both deem fair.

You should also seek the advice of an attorney if you would feel better getting a second opinion on whether or not the settlement amount is fair.

An attorney can set up a consultation to review your settlement amount and help determine if the amount is reasonable.

What information should I provide to the attorney?

Before seeking the advice of an attorney, you should make sure you have all your documentation handy.

Chances are you have already provided the information to the insurance company, but you need to be as thorough as possible.

Be sure to have physical copies of repair estimates, police reports, medical bills, names and phone numbers of witnesses, and any additional expenses you may have occurred, such as loss of work.

In addition to all of the above paperwork, you must also have the claim settlement amount. Once you have that, you can determine if the settlement is fair.

If you do not feel the settlement has covered your expenses, you can have the attorney send the insurance company a “demand letter” specifying the lump sum payout for which you are looking.

If you have exhausted all your options but still need to seek legal advice, be prepared to share some of your settlement with the attorney.

The attorney will be entitled to approximately 33 percent of the settlement. However, when there is an attorney involved, the settlements are usually higher.

How can I find an attorney?

You can find an attorney by asking people you know for recommendations, or by looking in the phone book or on the Internet.

However, it is important to retain the type of lawyer best suited for your case.

If there is an injury involved, seek the advice of a personal injury attorney. If your claim has been denied, find a “bad faith” lawyer.

An attorney can be extremely beneficial when settling an insurance claim, especially if there are added expenses other than car repair.

If you are having difficulties with your current insurance carrier, it might be time for a new agency.

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