Insurance Feels Different When Someone Gets Hurt

You have probably seen the commercials. Insurance companies spend enormous amounts of money reinforcing the same basic ideas over and over again: they are your friend, your neighbor and your protector. They are beside you when something goes wrong. They have your back. They will be there when you need them. The slogans and spokespeople change, but the message is remarkably consistent. Insurance is supposed to provide some peace of mind because someone will be there to help when something bad happens.

For many claims, the process can work reasonably close to the way those commercials suggest. If a storm damages your roof or someone backs into your parked car, there is a loss that needs to be evaluated and a dollar amount that can usually be calculated. You may argue with the insurance company about that amount, and dealing with the claim may still be frustrating, but everyone is trying to establish the price of something that can be repaired or replaced.

Personal injury claims are different because people cannot be repaired, valued or replaced the way property can.

Insurance Companies Know What Your Car Is Worth

Suppose you are driving a 2019 Honda Civic when another driver causes an accident. Your windshield is cracked, the bumper is destroyed and several body panels need to be replaced. There may be another $2,000 worth of damage underneath that nobody can see until the body shop takes the car apart.

For you, this is a significant disruption. You need transportation. You have to deal with a repair shop, rental car and insurance adjuster while continuing to work and take care of everything else in your life.

For an insurance company, however, the basic financial problem is familiar and measurable. There are thousands of 2019 Honda Civics on the road. Comparable cars are bought and sold every day. Replacement parts have prices. Body shops can estimate labor. The insurance company has years of claims data showing what similar repairs cost and what similar vehicles are worth.

The insurance company may disagree with you or the repair shop about some of those numbers, but there is still a number.

The Worst-Case Scenario for the Insurance Company: Your Civic Is Totaled

Keep following the same example. The body shop starts taking apart your Civic and discovers considerably more damage than anyone initially realized. At some point, repairing a $12,000 vehicle stops making economic sense.

The insurance company can total the car.

There may still be disagreement over whether the Civic was worth $11,000, $12,000 or $13,500. You may have to negotiate over options, mileage, condition or comparable vehicles. Eventually, however, there is a fixed value that can resolve the property claim.

If the car is worth approximately $12,000, the insurance company can pay approximately $12,000. You take the money and go shopping for another car. A week later, you might be driving another 2019 Honda Civic.

The same thing happens with hail damage. A storm can absolutely destroy a car. If the damage is severe enough, insurance can pay for the loss and you can replace the vehicle. Nobody wants their car destroyed by hail, but there is a possible outcome where the financial loss has been compensated and you are essentially back where you started.

Property gives the insurance company something extremely important: a reasonably knowable ceiling on the loss. A Civic has a market value. A windshield has a replacement cost. A bumper has a price.

An injured person does not.

There Is No Total-Loss Check for a Human Being

Now imagine that same accident caused a serious injury.

You went to the emergency room after the crash. Your back still hurt a week later, so you returned to the doctor. You started physical therapy. The pain continued. An MRI showed a disc injury. You received injections and eventually learned that surgery might be necessary.

During all of this, you have been missing work. Maybe your employer has been accommodating so far, but you are running out of paid time off. Maybe your job requires lifting, driving, standing or physical labor that you simply cannot do anymore. Your medical bills continue to grow while your income is going in the opposite direction.

The financial consequences can continue for months or years. Medical treatment may be necessary in the future. An injury may affect what kind of work you can perform and how much money you can earn. A serious injury can alter someone’s entire financial trajectory.

And money is only part of the loss.

Maybe you used to play golf with your kids every Sunday and now you cannot comfortably swing a club. Maybe you walked three miles every morning and now walking around the grocery store hurts. Maybe you cannot pick up your grandchild. Maybe sitting through your son’s baseball game leaves you in pain for the rest of the evening. Maybe you wake up several times every night because there is no comfortable way to sleep.

How much is any of that worth?

How much is a leg worth? How much is the ability to walk without pain worth? What is the value of being able to do your old job for another 20 years? How do you put a price on an activity that was an ordinary part of your life until someone else’s negligence took it away?

There is no list of comparable people for an insurance adjuster to check. There is no replacement price for your body and no check that allows you to go buy the life you had the day before the accident.

A Large Personal Injury Settlement Is Not a Sweepstakes Prize

This is worth understanding when you see advertisements announcing enormous personal injury settlements and verdicts.

A million-dollar injury case can sound like someone received a million dollars because something bad happened to them. That number looks very different when you understand what may be behind it.

Large personal injury recoveries are generally associated with large losses. Someone may have undergone multiple surgeries. Someone may be permanently disabled. A person who expected to work for another 25 years may no longer be capable of doing that work. Someone may need medical care, medication or assistance for the rest of their life. In the most serious cases, a family may have lost someone entirely.

The number is a measure of the harm the legal system is attempting to compensate.

Nobody who loses the use of a leg walks away from a case thinking that the injury was a good financial trade. Nobody gets years of their health back because an insurance company wrote a check. A settlement cannot undo surgery, restore missed time with your family or guarantee that chronic pain disappears.

The legal system uses money because money is the tool available to compensate someone for a loss. The more devastating and permanent the loss, the larger the amount required to reasonably account for its consequences.

That is why those enormous numbers should not look like lottery jackpots. They should tell you something about how seriously someone was hurt.

The Financial Risk for the Insurance Company Can Become Enormous

The difference between property damage and personal injury also explains why the insurance process can change so dramatically after someone gets hurt.

With the Civic, the insurer could determine the approximate maximum value of the property loss fairly quickly. Once the vehicle was totaled and its value established, the property question had an endpoint.

A serious bodily injury claim can expose an insurance company to substantially greater and less predictable financial consequences, subject to the available insurance coverage and the facts of the case.

Medical expenses may continue accumulating. Future medical care may have to be considered. Lost wages can become a claim for diminished earning capacity when an injury affects someone’s career. Pain, disability, disfigurement and loss of normal life may also become significant parts of the damages.

The stakes can become very high very quickly.

Insurance companies prepare for that. They have adjusters, investigators, claims professionals and attorneys whose job is to evaluate claims, challenge unsupported damages, defend their insureds and protect the company’s financial interests. When a significant lawsuit is filed, the insurance company does not walk into that process alone.

An injured person should understand that before trying to handle a serious claim alone.

Why Does the Insurance Company Want My Medical Records?

Once an injury claim is made, the insurance company needs information about what happened to you. Medical records can establish your diagnosis, treatment, prognosis and the relationship between the accident and your injuries.

They can also become a source of disagreement. An insurer may argue that your back problem existed before the collision, that some of your treatment was unrelated to the accident or that the amount of treatment was greater than the insurer believes was necessary.

Those questions directly affect how an insurer evaluates the claim. If you suffered a significant injury, an attorney can help determine which medical information is relevant and how the medical evidence fits into the larger case.

Why Does the Insurance Company Want a Recorded Statement?

Insurance companies investigate claims, and an adjuster may ask you to provide a recorded statement about the accident, your injuries and your medical treatment.

What you say can become part of the claim file.

There is an important distinction between your own insurer and another driver’s insurance company. The Illinois Department of Insurance notes that you have a contractual relationship with your own insurer in a first-party claim, while in a third-party claim you have no contract with the other driver’s insurer and that company’s primary obligation is to its own policyholder.

If you have been seriously injured and another driver’s insurer wants a detailed recorded statement, consider speaking with an attorney before providing one.

The Other Driver Was Clearly at Fault. Why Is the Injury Claim Still Being Disputed?

Determining who caused the collision is only one part of a personal injury case.

An insurance company can accept that its insured caused an accident while disagreeing about the injuries that resulted from it. The insurer may question whether the accident caused a particular medical condition, whether all of the treatment was related to the collision, whether you have completely recovered or what your remaining limitations are worth.

That is why even an accident with relatively clear liability can develop into a significant dispute when serious injuries are involved.

Why Did the Insurance Company Offer Me Money So Quickly?

Sometimes an injury claim can be resolved relatively quickly. An early settlement offer is not automatically improper.

The important question is whether you actually know the extent of your injuries before agreeing to end the claim.

The Illinois Department of Insurance cautions consumers that settling a third-party claim generally involves signing a release establishing the settlement as the only amount the claimant will receive from the other driver and insurer. The Department specifically notes that property damage may be ready to settle while the bodily injury claim remains unresolved because medical bills are still ongoing.

That makes sense. You can know what happened to the Civic long before you know what happened to your back.

What Is a Release?

A release is an extremely important document because it generally ends the claim in exchange for the settlement payment.

Imagine accepting a settlement three weeks after an accident because you expect your back pain to improve. Two months later, an MRI identifies an injury requiring surgery. If you already entered into a final settlement and released the claim, you generally cannot reopen negotiations simply because the injury turned out to be more serious than you expected.

Before accepting a bodily injury settlement, you should understand what you are signing and have a reasonable understanding of the injuries and losses the settlement is intended to cover.

Why Should I Hire a Personal Injury Attorney If There Is Insurance?

Because the insurance company is already represented in this process.

It has people evaluating how the accident happened, whether its insured is legally responsible, whether your injuries were caused by the accident, whether your treatment was reasonable, what future medical care may be necessary and how much the company believes the claim is worth.

When the claim involves a damaged Civic, you may be comfortable negotiating about the price of a bumper or the value of the vehicle yourself.

When the discussion involves your health, your ability to work and potentially years of consequences from an injury, you deserve your own advocate in that conversation.

A personal injury attorney can investigate the accident, preserve evidence, gather medical documentation, evaluate available insurance coverage, document lost income, work with medical and financial experts when necessary and determine how the injury has affected your life as a whole.

If the insurance company will not agree to a fair resolution, your attorney can pursue the case through litigation and, when appropriate, present that case to a jury.

Insurance Still Matters. So Does Understanding Whose Interests Are Being Protected.

Insurance is an important part of our system. It repairs vehicles, replaces damaged property and provides a source of compensation when someone’s negligence causes another person serious harm.

But an insurance company evaluating a bodily injury claim has its own financial interests and legal obligations. In a third-party auto claim, the Illinois Department of Insurance expressly notes that the other driver’s insurance company does not have a contract with you and its primary obligation is to its own policyholder.

Illinois law also regulates how insurers handle claims. Among other things, the Illinois Insurance Code addresses prompt investigation and settlement standards, reasonable investigations before refusing payment, and good-faith efforts to reach prompt, fair and equitable settlements when liability has become reasonably clear.

Those protections matter, but they do not give an injured person their own advocate.

If you were seriously injured in an accident, Giamanco Law Partners can evaluate what happened, explain how the insurance process applies to your case and help determine the full extent of your losses before you make a permanent decision about your claim.

The consultation is free. You can start with a phone call, video meeting or email. Before signing a release or accepting a settlement for a serious injury, find out what you may actually be giving up.