Each injury case is different and a pure numerical analysis has major limitations. Are there some universal truths? Absolutely. Can we make fairly accurate estimates on value? Yes.
There are three core concepts to understand as we go forward and examine a claim’s value:
I. The Settlement offer from the insurance company will be a discounted amount pulled from the low end of the insurance company’s evaluation of the range of probable jury verdicts.
II. The Gross Settlement number is unimportant, it’s what you take home that matters.
III. Pain and Suffering cannot be calculated through a math formula based on the medical bills.
I. How is the Settlement Offer Calculated by an Insurance Company?
Each insurance company is different. Some use computer programs like Colossus. Read Kosierowski v. Allstate Ins. Co., 51 F.Supp.2d 583 (E.D. Pa. 1999), for an interesting discussion of how Allstate considered the Colossus value ranges in making a settlement offer, but ultimately deviated from them. Some insurers in Georgia use Colossus, some use other proprietary systems.
You will most commonly see computerized values for average whiplash, soft tissue injury cases. The insurance carriers have years of data on how these types of claims perform in front of juries. Factors taken into account include:
Visibility of the property damage, does it look like hard impact or nothing at all?
The venue where the case will be brought and the historic behavior of those juries.
The likeability of the plaintiff, are they employed, good citizens, no criminal record.
The nature of the injury, fractures are worth far more than soft tissue injuries. Surgical cases are worth more than non-surgical cases.
Is the injury permanent with ongoing medical care and future medical bills.
Total of the gross medical care.
Lost wages. Past and future.
Amount of liability insurance protecting the defendant.
If you have this information available, we can make an accurate estimate of the case value within ten minutes.
Once these factors are known, the insurance carrier is able to estimate a range of verdict values. They are going to choose from the low end of the range and then want a discount for present-day value. Now you know where the number is coming from so you need to know:
Is it a fair offer given the factors?
Will getting a verdict put more in your pocket?
II. It’s Not the Gross Settlement Value that Matters, it’s What you get to Keep that Matters.
Most injury lawyers in Georgia charge 33-35% if the case is settled without filing a lawsuit and from 40-45% if you settle the case in litigation. The typical car accident case will also entail around $4,000 in litigation expenses from depositions, medical records acquisition etc. Knowing that, you had better make darn sure that the gross settlement value will go up past the last pre-suit offer to a degree that merits paying an addition 7% to the lawyer and an additional $4,000 in expenses.
$20,000 presuit offer with a 33% presuit fee would yield you $13,400 before repaying any medical expenses.
If the lawyer tells you the case is worth $30,000 at trial, should you proceed?
$30,000 at a 40% fee yields you $18,000 but then you have to subtract the litigation expenses which leaves you with $14,000. Is it worth waiting two years to get to trial to hopefully get an extra $600. What if you get unlucky with the jury.
Keep your eye on the goal and don’t get distracted by the gross settlement offer.
III. Pain and Suffering Formulas are B.S.
In the 1980’s there were rumors that two times to three times medical bills were typically offered. There were examples aplenty, but those days are long gone. We live in a world where the hospital bill itself can be $30,000 on a simple car wreck. The balance of the medical care might only be physical therapy totaling another $8,000.00. A case like that with $38,000 in medical bills is worth about $50,000, not $76,000. It turned out to not be that painful. The reverse can also be true. A fracture case with no surgery and only $12,000 in medical bills can easily be worth $75,000 in the right circumstances.
If you want an accurate estimate of the value of your case with no strings attached, just email the firm with the factors listed above.