How Much is my Car Accident Case Worth?
You want to know how much your car accident case is worth? Well, you’re asking the $64,000 question – and it’s one that just about every plaintiff wants to have answered. If you have recently been involved in a car accident and have spoken with attorneys, you’ve likely asked this question to each of them. And, you’ve probably been told a wide range of possible case values or even been told that it is impossible to tell you what your case is worth. So where do these numbers and values come from and why can’t you seem to get a straight answer?
Your car accident case is worth the amount of damage sustained – no more, no less
That’s right – your case is worth the amount of damage you have suffered. This would be an easy question if your damages were simply comprised of your out of pocket expenses such as medical bills and lost wages. Those types of damages are what we plaintiff attorneys refer to as “special damages.” That is, these are all of those expenses that we can readily compute. Obviously the big one is medical bills, but things like lost wages can mount up as well if your injuries have prevented you from working while being treated.
But these are not the only compensable damages in a personal injury case. What about pain and suffering? Inconvenience? What if your are permanently disabled? Partially disabled? Have trouble sleeping? The list could be expanded, but you get the point. All of these types of things make up what we refer to as “general damages.” That is, these are generally the types of damages that cannot be readily calculated because they are not a result of an out of pocket expense. A fancy lawyer way to describe these is “non-pecuniary losses.”
The old rule of thumb to determine general damages was to multiply the special damages by 3.
I have been told that the old way to rough out a case value was to take your special damages (usually your medical expenses), and multiple that by 3. That would yield the “reasonable” value for general damages and your ultimate case value. However, everyone should be able to see how flawed that is. I didn’t practice law back when that was something people actually followed, but I’ve heard it said by many attorneys. How in the world is that supposed to be accurate? For example, somebody may have been injured in a car accident and required surgery, but it may not have been that painful, inconvenient, etc… And they may be completely healed or recovered after just a few weeks. On the other hand, another victim may never receive surgery but suffer with great pain and be left to simply deal with it and take narcotics for the rest of their life. The person who got the surgery may have significantly greater medical expenses, but are we to believe that simply having greater medical expenses somehow means they suffered greater pain? Inconvenience? Suffering? Of course not, but that is exactly what the old “rule” would yield.
Sometime around the turn of the century many insurance companies sought to increase their profits. Obviously they could have increased premiums, but then they may lose customers due to competition. So, they started looking into ways to decrease costs. This included a wave of changes to increase operational efficiency, but the goldmine was found in the claims department. They knew that if they could somehow pay less on claims that would mean a bigger bottom line and increased profits.
The insurance industry is highly regulated, so insurers couldn’t just implement a blanket policy to pay less on claims or to deny a greater number of claims altogether. You see, if insurers don’t treat their policyholders “fairly” they are subject to some pretty stiff penalties. You may have heard the term “bad faith” being thrown around. What that means is that if an insurer improperly denies your claim or otherwise treats a policyholder in a way that violates the implied duty of “good faith,” they can be forced to pay extra on the claim, such as consequential damages. Bad faith claims against insurers are the real weapon litigants have to make sure the insurance companies play nice and fair.
To avoid running afoul of its obligation to settle claims fairly, insurers began hiring consultants to develop computerized software to evaluate claims. These are very complex systems and have hundreds or thousands of variables that will determine case values. Without boring you with details as to some of those factors, the end results was a dramatic decrease in the total claims paid out. And, since a large number of these claims were now being decided by a computer system, the insurers could largely absolve themselves of being accused of bad faith when it offered a low settlement. After all, how can the computer system be unfair? It is just spitting out a number based on a complex formula! While this doesn’t always work, you can see how easy it would be for claims adjusters to simply throw up their hands and say “well, my computer says your car accident case is only worth X, so I am not authorized to offer more.”
So what does that mean for your car accident case value?
Without boring you with even more background information, what this means is that in order to maximize the value of your car accident case your attorney must understand these systems, what factors drive value, and how to showcase or frame those factors in a way that is most favorable to your case value. This means that your attorney should be spending the majority of its time on your case before any lawsuit is ever filed.
Most car accident cases settle out of court. A good, qualified car accident attorney will spend as much time drafting its settlement demand as it should in preparing for trial (okay, so maybe trial prep would be more time consuming, but the demand should be more than a simple letter asking for money). A good demand letter will outline each relevant data point from the client’s medical records. For questionable data or something in the medical records that could go either way, the lawyer should advocate why it should be included in settlement calculation by providing supporting documentation from studies and case law. If involved early enough, the attorney should meet with treating physicians to explain the need for medical records to be recorded properly. For example, if a medical record notes that “patient presents with pain in lower neck radiating to upper back” that will generally be treated with less value than if the records stated “patient presents with pain in lower neck; pain in upper back.” The former will generally be looked at as a single injury where the latter where be counted as two separate injuries, which should increase the value of the case. There are many little nuances like this that can be coached to medical providers so that the records will reflect injuries in a manner that increases settlement value.
When I handle a car accident case I gather all the pertinent medical records, cull out each relevant data point, and put it into tabular format. This includes, among other things, a table of complaints, treatments, assessments, therapies, and diagnostic imaging or testing. I insert that tabular data into my demand letter, along with references to any supporting studies and case law, and some narrative to give the adjuster the non-medical story of my client’s injuries. My entire goal is to do all the work for the adjuster – highlighting the relevant medical facts and giving a cited table right there in my demand. That way, all the adjuster needs to do is verify my data points by looking up the page numbers I’ve referenced in the table. I don’t want to leave it up to the adjuster to find a specific piece of information in the records. After all, my client and I have a much greater incentive to find and include all relevant data from the medical records.
If all of this information seems like overkill, it is. Most plaintiffs don’t care how or why a settlement demand is drafted the way it is – they simply want to get their case resolved for a fair value. But understanding some of what goes in to drafting a good, solid demand letter that will yield the highest value for you and your case will help you understand why we don’t just shoot of a couple paragraphs and demand a certain amount. In our office, the more time spent preparing the demand letter and reviewing medical records generally results in a greater chance at settling your case for the most money. Only after we have reviewed your medical records and drafted a demand letter can we give you our opinion as to what your case is worth. So, if you want an actual number for your case, call one of our car accident attorneys today and let us get started on evaluating your case.
