One of the most common questions about personal injury cases in South Carolina is, “How much is my claim worth?” That seemingly easy question can be difficult to answer, as every personal injury case is different. However, knowing how insurance companies calculate potential settlements can illuminate your possible compensation. Furthermore, working with a capable and driven attorney is crucial if you want maximum compensation for your losses. So, how do insurance companies determine settlement amounts?
The Greenville personal injury lawyers at Maxey McFarland Law understand the devastating toll accidents can take and can assist you in recovering full compensation for your injuries. Most personal injury claims in South Carolina ended with insurance settlements. Everything you need to know about how insurers calculate settlement amounts is below.
The Basics: What Is an Insurance Settlement?
A settlement is a legal agreement between you and the at-fault party who caused your injuries or their insurer. This agreement compensates for your losses in exchange for your promise not to pursue additional legal action against the at-fault party or their insurer. But how do insurance companies determine settlement amounts?
Most South Carolina personal injury claims end in settlements because they provide certainty for both you and the insurance company. A settlement provides you with guaranteed compensation, whereas taking your case to trial might mean you don’t recover any. Insurance companies also like settlements because they can definitively close a claim without worrying about the time and expense of a lengthy trial.
What an Insurance Settlement Covers
A personal injury settlement can cover many of these losses you’ve experienced after an accident, such as:
- Your current medical bills
- The cost of any future medical treatments you might need
- Your lost income while you heal from the accident
- Your reduced future earnings because of accident-related injuries
- Your pain and suffering
- Your emotional distress
- Your diminished quality of life
- Your damaged personal property
How Insurance Companies Calculate Your Potential Compensation
How is settlement value calculated? Many losses an insurance company might cover have defined values you can prove with the right evidence. These losses include your lost income, past and future medical expenses, and the cost to repair or replace damaged personal property. Pay stubs, invoices from your healthcare providers, treatment plans, and repair estimates can help you substantiate these losses.
Other losses that might be included in a settlement are harder to quantify. An experienced lawyer can help you prove these losses and seek appropriate compensation for them. These intangible losses include things like your pain and suffering, emotional distress, diminished quality of life, and any negative changes in your relationships since the accident.
For your specific losses, an insurance company can use your pay stubs and other documents to calculate precisely how much the accident has cost you. Because your subjective losses are more intangible, insurance companies must use different methods to calculate your compensation.
One approach is called the “multiplier method.” This approach involves adding up your specific losses, multiplying that figure by another number (usually between 1.5 and 5), and using that amount as the figure representing your intangible losses. Another approach insurance companies sometimes use is called the “per diem method.” In this method, the insurer values each pain day post-accident, multiplying it by the injury’s expected duration.
While these methods can help insurance companies determine settlement amounts, they’re imperfect. An insurance adjuster might undervalue your intangible losses if you don’t have sufficient evidence to substantiate your claim. An attorney can gather evidence to support your claim and negotiate with the insurers on your behalf to reach a fair agreement.
Evidence to Prove Your Losses From an Accident
To recover maximum compensation for your losses in an insurance settlement, you’ll need compelling evidence to support your claim. Some evidence that your lawyer can gather to prove your case includes:
- Medical records – Your medical records serve two key purposes in insurance settlement negotiations. First, they help prove the cost of your medical treatments and show when you acquired your injuries. Second, your medical records can help prove how your injuries impact your daily life. This helps you seek compensation for your intangible losses.
- Pay stubs – Your employer’s pay stubs and related documents can help you show precisely how much salary or wages you’ve lost while recovering from your injuries.
- Photos and videos – Photos of your injuries and videos of your daily life can provide additional context for how your injuries affect your daily life and prevent you from participating in activities you used to enjoy.
- Expert testimony – Medical experts, financial planners, and other professionals can testify about how the accident has impacted various aspects of your life. Expert testimony is often crucial for recovering compensation for intangible, subjective losses.
Are There Limits on Your Compensation from a Settlement?
South Carolina law doesn’t limit your potential compensation in a personal injury claim. In these cases, state law limits compensation for your intangible or non-economic losses to a certain amount that changes annually based on inflation. (For 2024, the current cap on compensation for non-economic losses in these cases is $564,168.)
Having said all that, an insurance company will never pay more in a settlement than its policy limits. An experienced lawyer can determine what the liable party’s insurance policy limits are and give you a better idea of how much your potential compensation may be.
How Our Lawyers Can Help You Maximize the Value of an Insurance Settlement
Hiring Maxey McFarland Law to handle your personal injury claim means you don’t need to worry about the details of an insurance settlement. Our experienced personal injury attorneys from Greenville, SC, can handle all the legal work for you, from gathering the necessary records to submitting an insurance claim and negotiating an appropriate settlement. Our firm can also represent you in court, like countless others, if the insurance company refuses to make a reasonable offer. While we’re handling the legal work, you can focus on healing and rebuilding your life.
Trust Maxey McFarland Law to help you get a fair insurance settlement after an accident. Call (864) 900-4231 now or complete our online contact form to schedule a free consultation.