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How Do Car Accident Settlements Work?

Florida Car Accident Settlements

Florida law requires motorists to carry a minimum of $10,000 in personal injury protection (PIP) coverage pursuant to Florida’s no-fault insurance system. This means that after someone suffers injuries in a car accident, they must first file an insurance claim under their own PIP policy or someone else’s policy that might apply.

Fault plays no part in Florida car accidents until an injured person has met or exceeded their PIP policy limit, which only covers 80 percent of medical expenses and 60 percent of lost wages related to the accident and injury. Once PIP coverage has been exhausted, car accident victims can step outside of Florida’s no-fault insurance system. This is where the car accident settlement process begins.

Suffering severe injuries in a car accident can financially devastate a household. This makes pursuing compensation for a car accident a necessity for some. If you reach a settlement in your car accident case, you can receive compensation for medical expenses, lost wages, future medical expenses, future lost wages, and non-economic damages including pain and suffering, mental anguish, loss of consortium with a spouse, or any other non-economic losses which apply to your situation.

This guide provides you with an in-depth look at how car settlements work in Florida by car accident attorneys at Dolman Law Group. Not all car accident claims go the same way. In most cases, the insurance company of the at-fault driver pays the settlement amount to the accident victim. Yet, in some cases, the driver or another party might directly compensate an accident victim. Below we explain the car accident settlement process while offering some caveats and providing some insight into specific situations that deviate from the normal process.

Filing a Car Accident Injury Insurance Claim

Once you’ve reached your PIP policy limits, you will have to file an insurance claim with the at-fault driver’s insurance company. Florida’s financial responsibility statutes require drivers to provide proof that they have $10,000 to cover damages for bodily injury or death per person and $20,000 per accident. The vast majority of motorists meet this requirement by purchasing bodily injury liability (BIL) coverage.

These limits only apply when a motorist owns their vehicle free and clear and has possession of their title. Those who have leased vehicles or loans against their vehicles must carry $100,000 in Bodily Injury Liability (BIL) coverage per person and $300,000 coverage per accident.

Whether you gathered insurance information yourself at the time of your accident or you got it from the official crash report, you can contact the at-fault driver’s carrier by phone to report the accident. Some insurance companies have online portals for you to file a claim online. You or your car accident lawyer should also report the accident to your own carrier to inform them of a potential claim. This protects you in the event the driver who struck you is uninsured or underinsured.

Insurance Company Investigation

After you file a formal claim with the at-fault driver’s insurance company, they will investigate the accident to decide the claim. This can include examining the traffic crash report, interviewing witnesses on record, and consulting with accident specialists and medical experts. Insurance companies and their representatives are not your friends, especially when you aren’t the policyholder. They are out for their bottom line and don’t stay in business by approving every claim.

You can expect the company and their assigned adjuster or representative to find every opportunity possible to devalue your insurance claim. Some insurance companies are aggressive to the point they will push the envelope on ethics and go as far as to violate your rights. An adjuster or representative will take your statement and they might also request access to your medical history. You should consult with a personal injury attorney before signing any waivers or authorizations for the carrier.

Denial of Your Car Accident Claim

The insurance company will complete its investigation and approve or deny your claim. In some cases, the carrier will outright deny your claim. This can occur for many reasons. The company might deny the claim for procedural reasons or simply because they found their policyholder wasn’t liable for damages. If you get denied, the car accident settlement process stops here unless you contact an auto accident lawyer to help you pursue the money you deserve.

Initial Car Accident Claim Settlement Offer

If the insurance company doesn’t deny your claim, they will typically make you a settlement offer for your car accident claim. In many cases, the initial car accident settlement offer is low. Insurance companies always want to pay out the least amount possible. The first offer is meant to tempt accident victims with enough money to accept it, but not to pay out the full value of the claim. Once you accept a settlement offer, the insurance carrier typically insists you sign a waiver that prohibits you from suing for damages in civil court.

Negotiating a Car Accident Settlement

If you receive a settlement offer after filing a car accident claim with the at-fault driver’s insurance carrier, consider it as a jumping-off point for negotiations. Insurance companies have large legal teams and adjusters who know their jobs well and know how to intimidate accident victims. It’s in your best interest to consult with a personal injury attorney to handle negotiations. Auto accident lawyers have experience dealing with large insurance carriers and their legal teams, most are skilled negotiators, and you have a good chance a lawyer can negotiate a better settlement for you than you can alone.

An attorney can also value your claim appropriately. It’s easy to add up quantifiable damages such as medical expenses and lost wages, but evaluating future lost wages and future medical treatment associated with severe accidents often requires third-party expertise, such as consulting a physician or economist. Personal injury lawyers often have a network of experts who can help value a claim, such as life care planners and accident reconstructionists.

Mediation of a Car Accident Settlement

Mediation is an alternative dispute resolution (ADR) process. If you and the insurance carrier cannot reach a settlement agreement, one or both parties can request mediation. During mediation, you and one or more representatives from the insurance carrier will meet with a mediator to discuss your claim and the value of damages. The mediator is only there to facilitate the conversation and keep a record; mediation is non-binding. This means the mediator cannot force the insurance company to pay a particular settlement amount, nor can he or she force you to accept a specific offer.

arbitration of a Car Accident Settlement

Arbitration is another form of alternative dispute resolution. Like mediation, arbitration is a meeting between you and one or more representatives from the insurance company, but unlike mediation, arbitration is binding. This means the arbitrator listens to your case, much like a judge, and makes a final decision about how much you receive in a car accident settlement. You and the insurance company must agree to arbitration; you cannot be forced to participate.

Arbitration offers some potential benefits, making it a popular option for those who want to avoid going to court. Parties only need to pay the arbitrator’s fee, not court costs and other expenses associated with going to trial. The arbitrator has the final word, which means the insurance company cannot appeal the decision. This is an attractive bonus if you are content with the settlement amount designated by the arbitrator.

Filing a Florida Personal Injury Lawsuit

Car Accident Attorney, Matt Dolman

Car Accident Attorney, Matt Dolman

The last resort for car accident victims to get the compensation they deserve for losses incurred as a result of their injuries is to file a personal injury lawsuit. If you hire an attorney to represent you and bring a suit against the at-fault driver, you still can end up receiving a settlement. In fact, more than 95 percent of car accident lawsuits settle before going to court.

Sometimes insurance carriers don’t take claims seriously or severely undervalue a claim. Filing a personal injury lawsuit gets their attention, and often encourages insurers to engage more readily in negotiations. If mediation or arbitration wasn’t on the table before the lawsuit, the insurance company might agree to participate once a suit has been filed.

Uninsured Motorists, Underinsured Motorists, and Other Situations

In most serious car accident claims, the at-fault driver’s insurance carrier will be the party who pays out a settlement for you. Yet, some unique situations exist where another party might compensate you. Some examples include:

Underinsured Motorists

Severe car accidents are costly and a chance exists that your damages will exceed the bodily injury liability insurance policy limits of the at-fault driver. If you have purchased underinsured motorist coverage, it will kick in when these situations occur. Yet, you will only receive compensation up to your policy limits.

If your injuries and losses exceed your underinsured motorist coverage, a personal injury lawsuit is likely the next step to recover additional compensation. This can easily occur when an accident results in expensive, catastrophic injuries. Accident victims who suffer permanent disabilities, especially those who need ongoing treatment and care, can rack up medical expenses quickly.

Uninsured Motorists

Uninsured motorist insurance works the same way as underinsured motorist insurance. If the at-fault driver doesn’t have insurance, you will need to file an insurance claim under your uninsured motorist policy, if you have one. This might result in a settlement from your carrier and a settlement with the at-fault driver if you sue for additional damages.

Multi-vehicle Accidents

The description of the process provided above assumes you were involved in a car accident with only one other vehicle. Unfortunately, dangerous multi-vehicle collisions occur. When more than one party is involved, this can mean more than one insurance company involved. These situations can be murky because each party usually tries to shift blame to one or more other parties. You will need to notify your insurance carrier and provide all the information you have about the others involved in the accident. Some carriers will pay out a certain amount on a policy and then seek reimbursement from the at-fault drivers.

Same Carrier Situation

One of the most troublesome situations with a car accident claim is learning that you and the at-fault driver have the same insurance carrier. Insurance companies need to carefully handle these claims so they avoid a conflict of interest. In most cases, this means assigning a different representative or adjuster to each party. The previously discussed investigation process will go on much the same.

Even more important: Speak deliberately and carefully with your adjuster. Even though you are a policyholder, the carrier will still likely attempt to devalue your claim as much as possible. Letting a personal injury lawyer handle communications in these types of cases can help protect you from insurance company tricks.

Self-Insured Drivers

Florida does allow motorists to provide their own insurance—that is, if they have enough money to pay for damages if an accident occurs, so they don’t need to buy a policy. If you are in an accident with a self-insured driver, you will skip the insurance process. Don’t forget to report the accident to your insurance company; many carriers have clauses that require drivers to report an accident if their coverage would apply. You will typically satisfy this requirement when you file a claim under your PIP policy.

An accident with a self-insured driver might mean you (or better yet, your lawyer) will negotiate directly with him or her. In other situations, the driver can deny liability and refuse to pay. This means you will have to file a lawsuit to receive any compensation.

Seek an Experienced Car Accident Attorney

Most car accident settlements work the same in Florida, but you might come across a few situations that disrupt the typical process. In any case, it’s wise to contact an experienced car accident attorney who can help guide you through the claims process and advise you on whether or not you need to bring a personal injury suit against the at-fault driver, or even your own PIP carrier, to receive compensation. This can help the settlement process go more smoothly, and prevent you from having to deal directly with insurance companies who likely aren’t on your side.


Dolman Law Group
800 N Belcher Rd
Clearwater, FL 33765
(727) 451-6900

Car Accident Lawyer