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Understanding Settlement Negotiations in Alabama Personal Injury Cases

When a person suffers property damage or bodily injury in Alabama due to the fault of another person or entity, negotiations are often undertaken to settle the matter before a trial ensues. This process saves much-needed resources for all involved parties. Indeed, most personal injury cases settle outside of court. Though settlements are desired, you must ensure that your rights and interests are protected throughout the process and that if you are the injured party, compensation is just and fair.

At Ritchey Legal, PLLC, our personal injury lawyer in Birmingham works to ensure your rights and interests are adequately and comprehensively addressed during negotiations and are incorporated into the settlement agreement. Contact us at 205-225-9225 to schedule a consultation and to discuss your personal injury case.

Why Settlement Negotiations in AlabamaMatter for Personal Injury Cases

Settlement negotiations are a key part of personal injury cases. The majority of personal injury cases settle before the parties go to trial, with the defendant agreeing to pay the plaintiff damages to compensate them for costs including medical bills and future treatment, lost income, and pain and suffering. 

By settling, the parties avoid the expense and uncertainty of a trial, and the plaintiff receives an earlier payout. Even if negotiations do not result in a settlement, they give parties an insight into the strengths and weaknesses of each other's arguments before a trial. 

If you are involved in a personal injury case, the defendant is often an insurance company. Insurance companies usually appoint an adjustor for settlement negotiations, who follows your case and negotiates on behalf of the insurer. Depending on the facts and circumstances, however, the defendant may also be a business or an individual in addition to their insurer.

Settlement negotiations involve two competing interests. As the injured party, you want to receive the maximum payout that compensates you for your injuries. As your attorney, we will fight for the same. The insurer, on the other hand, has a commercial interest to try and negotiate the lowest settlement possible.

Settlement Negotiations Process in Alabama

The specific procedure for settlement negotiations varies between states, however, it typically involves the following steps in some shape or form. 

Reservation of Rights Letter

Following an accident, an insurer usually sends you a reservation of rights letter. This explains that the insurer is investigating and reserves its right not to pay you if the accident that caused your injury is not covered by the insurance policy. 

Demand Letter

As your legal representative, we will review your case, conduct our own investigation, and identify a target settlement amount. We may then start settlement negotiations by sending the insurer a demand letter. This letter sets out information about your claim and the proposed settlement, including the details of your injury, the defendant's liability, the amount sought, the reasons for it, and supporting evidence, like medical reports and receipts. 

Settlement Discussions

After receipt of the demand letter, we may enter into negotiation discussions with the insurer or other defendants about the proposed settlement. This includes both sides arguing the strengths and weaknesses of our respective positions. It may also include a series of counteroffers. These discussions are usually undertaken over the phone, although they can be conducted in person. 

Written Offer

Once a settlement has been agreed upon, the parties will put it in writing, setting out the specific details, including the amount, what it covers, and the timeframes for payment. The written offer is signed by both parties, but the judge may have the final say on whether the settlement is approved or not.

Trial, if Applicable

If the parties cannot agree to a settlement, the matter will likely be litigated. Keep in mind, however, even if the matter continues on to trial, negotiations for a settlement can still take place with settlements being made during the middle of the trial.

What Civil Law Issues Get Negotiated in Alabama? 

During settlement negotiations, your attorney and the insurer usually discuss a range of legal issues related to the case. These issues include but are not limited to:

  • Insurance policy. What are the terms of the insurance policy, including any limits and whether it covers the accident?
  • Causation. What was/were the direct and proximate cause of the damages?
  • Liability. Who was responsible and did the victim contribute to the injury?
  • Damages. What is the nature and extent of damages (e.g., property damage, bodily harm, emotional or mental distress)?
  • Remedies. What is the nature and extent of the remedy (e.g., reimbursement for property damage and medical treatment and compensation for pain and suffering and loss of enjoyment)?

The parties use these points to support the settlement figure they propose. 

Pros and Cons of Settlement Negotiations in Alabama

Settlement negotiations offer many advantages, including the opportunity to settle without litigation that said, some disadvantages exist and should be considered.

Benefits of Settlement Negotiations

  • Faster resolution. Settlements typically result in a quicker payout than if you proceed to trial. 
  • Less expensive. Trials can be lengthy, stressful, and expensive. As well as lawyer fees, there are various incidental costs such as filing fees, depositions, and time off work to attend. Settlement agreements avoid the costs associated with a trial. 
  • Compensation guarantees. The outcome of a trial is never guaranteed. If you lose, you do not receive any compensation. A settlement, however, can ensure you get some compensation, even if it is neither what you had anticipated nor wanted.
  • Confidentiality. Settlement agreements are confidential, whereas courts are open to the public and so what happens during trial becomes part of the public record.

Potential Disadvantages of Settlement Negotiations

  • Compromise. Settlements usually involve compromises, which means you may not receive maximum compensation. You may receive less compensation than if you had gone to trial and won. 
  • Final. Settlements are final. Unlike a judgment, they cannot be appealed. Once a settlement agreement is signed, you cannot revisit the matter, even if you develop new injuries or worse symptoms. 

The decision to agree on a settlement or go to trial depends on the specific facts in your case. Ultimately, as our client, you have the final say on the matter. We will advise you accordingly so that you can make an informed decision.

What Happens When Settlement Negotiations Breakdown

When negotiations break down, all is not lost. In circumstances where we believe the adjuster is acting in bad faith, we might want to raise a bad faith claim. If negotiations have broken down irretrievably, our next step is to consider taking the matter to trial. But remember, when cooler heads prevail, negotiations can begin again, even if a trial date is set or has already started.

Contact a Personal Injury Lawyer in Birmingham Today 

At Ritchey Legal, PLLC, our civil law attorney in Alabama knows a personal injury is not an easy thing to endure. You want it over, and you want your compensation so that you can get back to your life. We want that for our clients, too, and will strategically negotiate with the defendant with every intention to arrive at a favorable settlement. Contact us today by filling out the online form or calling us at 205-225-9225 to schedule a consultation.

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