If you were injured in an accident that was caused by someone else, you may be facing a long road to recovery. If you filed a lawsuit to receive compensation for your losses, it is a great relief when your lawsuit concludes, and you finally receive a settlement check. However, as you anxiously wait for a settlement check, you probably have questions about the personal injury claims process, your potential settlement check timeline, and why your personal injury lawyer may be holding your settlement check.
What Types of Injuries Can Result in a Settlement Check?
Whether your case involves a car accident, a slip and fall injury, product liability, medical malpractice, or another type of personal injury accident, you may have suffered significant losses. Those losses can include medical expenses, lost wages, pain and suffering, and more. What can you do, and where can you turn for help? This is when you need a trusted personal injury law firm to guide you through the legal processes.
When you file a personal injury lawsuit, you request compensation to help you recover from the losses related to your injury. Financial compensation is only one way to help you recover and resume your life. The primary purpose of a personal injury claim is to return an injured party to the position they were in before the injury, at least financially.
What is the Process of Receiving a Settlement?
Unfortunately, the complex legal process can take a significant amount of time. Before a trial begins, there are investigations, settlement negotiations, pre-trial motions, insurance claims, medical evaluations, and more.
Many accidents result in significant injuries, extensive medical expenses, and lost wages, so victims often feel anxious about when they can expect to receive a personal injury settlement check to help pay for their financial losses.
It is a relief when a lawsuit concludes, and you finally know the amount of your settlement check. However, as you anxiously await your settlement check, you may have questions about:
- The personal injury claims process in general,
- A typical settlement check timeline,
- Whether you can get your settlement check early,
- How settlement checks are mailed,
- If you can track your settlement check, and
- Why your personal injury lawyer is holding your settlement check.
What Is a Legal Settlement?
According to the Bureau of Justice, only 4 percent of personal injury cases go to trial. The majority settle out of court by mutual agreement between the parties. This resolution is called a settlement.
A settlement is an agreement that ends a dispute and results in the voluntary dismissal of all related litigation. It may happen during the early stages of litigation and in some cases, even before the injured person files a lawsuit. Settlements usually occur when the defendant and the plaintiff agree to the personal injury claims rather than going to trial.
However, a personal injury case can be settled even after filing a lawsuit, up until the time a jury or judge renders a verdict. After the parties see how a case was presented in court, they may choose to avoid the risk of leaving the outcome in the jury's hands and resolve the case on the courthouse steps.
What Factors Go Into a Settlement Amount?
As part of the settlement, the defendant must pay the plaintiff compensation for the losses associated with the plaintiff's injuries. However, the parties may have very different perspectives on the case. They may disagree about issues of fault or the amount of payment warranted.
The parties must decide whether to accept a settlement offer or continue to litigate the case, potentially ending in a trial. Insurance companies often offer a low initial amount, hoping for a quick settlement. As an injured persona, you should not agree to a settlement or sign anything provided by the insurance company without having an experienced personal injury lawyer in your corner.
The Pros and Cons of Settlement
For both parties, there are potential advantages and disadvantages to settling the case. By settling, both parties know the terms of the agreement and avoid the unpredictability of a trial. A settlement allows both parties to resolve the matter more quickly. Of course, a settlement is not final until the plaintiff or the plaintiff's attorney receives the settlement check and it clears.
The defendant may lack the money to pay a judgment. The settlement terms typically remain confidential, as opposed to public trial results. Attorney's fees and expenses will take a portion of the settlement amount, but these legal costs are also deducted from a court verdict. Some plaintiffs prefer to go to trial because they may receive a higher award of damages from a jury than in a settlement, or they simply want their day in court.
If you choose to settle your case, you do not immediately walk out with a check. Your check is part of a legally binding agreement. Each case is different, but specific key steps are involved in the process of receiving a settlement check.
Signing the Essential Documents and Release Forms
If both parties agree to a settlement agreement before trial, the lawyers will report the settlement to the court. Next, the court issues an Order of Settlement. This order generally requires that both parties complete all necessary paperwork within either 30 or 60 days. The most important settlement document is the release. This document absolves the other party of any further liability.
The attorney for the defendant prepares a release form, which should clearly and accurately outline the terms and conditions of the settlement. Release forms generally state that the injured person will not pursue additional compensation from the party liable for the injuries. The release will vary in length, depending on the circumstances of your case and the settlement terms. Most insurance companies require specific terms in their releases, and some states also may require specific language.
Most release forms cover three main points:
- You release the defendant and their insurance company from further liability. Even if you later find you have additional injuries or losses, you cannot request further compensation for your claim once you have signed the release.
- The defendant and their insurance company do not admit fault, even though they are paying the settlement amount.
- You release the defendant and the insurance company from any other claim for the related incident. This means you give up the right to file another claim for additional damages in the future.
Your personal injury attorney will review the release to ensure that all of the terms and conditions are correct. If there is a dispute, the attorneys will attempt to negotiate. If the attorneys cannot agree, a judge or jury will resolve the issue at trial, which may slow the process down.
Before signing the release or other settlement documents, read them carefully and ask your attorney to review them for concerns. You then sign the form in the presence of a notary public, who acknowledges that the signature on the document is your own and that you willingly signed it. Once you have signed, you cannot change the terms, negotiate further, or pursue other legal action regarding the occurrence. Then, the insurance company receives the document, usually through the defense attorney.
In some cases, the settlement agreement requires the parties to sign a confidentiality clause, also known as a non-disclosure agreement, as part of the release. This means you must keep any settlement amounts or other matters private. The defendant may want this clause to protect a company's reputation for safety or trustworthiness, or a high-profile defendant may not want the settlement to become widely known.
How Are Settlement Checks Mailed?
The at-fault party's insurance provider is usually responsible for paying the settlement amount. The insurance company processes the release and has a legal obligation to write the settlement check as soon as it receives your release, but internal issues may slow this process.
Some states have deadlines for when the defendant must provide the settlement funds after receiving the release form. Some laws may require interest on the funds from the date of the receipt of the release form, which provides an incentive for the defendant to pay promptly.
Insurance companies have strict internal procedures for issuing checks. The company's internal procedures control who will review your settlement agreement, make sure the release form is proper, legally protect the insured and the company, and then send the authorization to another department to cut and mail your check.
In most cases, the company will make this check payable to both you and your attorney. The insurance company sends the check to your attorney, who needs to deduct certain amounts before you can receive your money.
The Settlement Check Arrives at Your Attorney's Office
Once the check from the insurance company arrives at your attorney's office, the attorney deposits the check into an escrow account. This ensures that it has the funds to cover the check, so it remains there while the bank clears the check. Once the check clears in the escrow account, your attorney can begin to disburse the funds.
Your attorney will have to pay any outstanding liens. These include any pending debts you may owe to entities related to your case or another charge against you. Your attorney must pay these unsettled liens out of your settlement funds before releasing the money to you. Your attorney pays these first because if they aren't paid, the creditors can bring a civil suit against you.
Liens may include:
- Unpaid medical bills related to your injury;
- Unpaid child support; and
- Unpaid attorney's fees—for example, money owed to an attorney who provided legal services but was discharged.
Before hiring your attorney, you should have reviewed and signed an attorney's fees agreement. For personal injury cases, this is usually a contingency fee arrangement, which means the attorney's legal fees are a percentage of the compensation you receive. Your attorney will deduct their share from the settlement funds for the legal services that they provided and for any expenses that they paid in advance for your case. These costs may include filing fees, accident reconstruction experts, gathering and preserving evidence or medical records, expenses related to discovery, expert witnesses, and other services necessary for trial preparation.
Are You Receiving Full and Fair Compensation for Your Personal Injury?
You need to feel confident that you will receive full and fair compensation for all of your injuries and losses before signing the agreement.
An experienced personal injury lawyer can help you assess the amount and extent of your losses, but you need to understand the full cost of your injuries, too.
Here are some factors that you need to consider when evaluating a settlement offer:
- Your medical bills
- The length of your medical treatment
- Your lost income and the loss of the ability to ever return to work or the same job
- Any ongoing or long-term treatment that you may require
- Your long-term diagnosis
- Your pain and suffering, now and in the future
Payment options are another important consideration. You need the settlement funds to pay bills and possibly replace your income. You may choose to receive your compensation as a single large sum. That means that you will receive the total amount of your settlement proceeds in one lump sum payment.
Alternatively, you may receive your compensation in a series of periodic payments in the form of a structured settlement. These structured payments are usually made from annuities owned and administered by life insurance companies. Structured settlement annuities can be tailored to fit individual needs, taking into consideration the amount and frequency of payments as well as other factors. Once agreed upon, you usually cannot change the terms.
Potential Delays and Tracking Your Settlement Check
The time it takes to receive a settlement check varies from one case to another.
Delays happen because:
- There is a dispute regarding the release form.
- The case involves a minor or an estate.
- Your attorney is negotiating the amount of a lien.
- The settlement and release agreement was not properly signed and returned.
- An insurance office in one state processes the claim, and an insurance office in another state issues the check.
- The claims adjuster in charge of your case may have left due to a vacation or unexpected illness and did not forward your documents for the necessary approval.
- The supervisor responsible for signing off on your agreement is unavailable.
- Clerical errors.
Is It Possible to Receive Your Settlement Check Early?
Once you have signed the completed release, it generally takes about six weeks to receive a settlement check; however, it can also take much longer. The timing depends on the defendant's policy, the type of personal injury case involved, and other circumstances.
The fasted way to bring your case to the best conclusion for you is to work with an experienced personal injury lawyer. Depending on your unique circumstances, your attorney may be able to expedite your payment, so you should discuss this possibility with them to learn more.
Your attorney may expedite the process by preparing and providing you with the necessary documents. You should review these documents carefully and return them promptly. If you have any questions or concerns, do not hesitate to ask. Liens may slow down the settlement check process. You may wish to discuss certain liens with your attorney to speed up the resolution of these debts.
The Final Process of Receiving Your Settlement Check
Completing the settlement process requires close attention to detail. After your attorney has deducted all liens, fees, and expenses, they will write you a check for the remaining amount of your settlement. You may wish to consult a personal injury attorney to determine the tax consequences, if any, of your settlement money. Now you can begin your financial recovery and plan your post-injury life.
For more information about personal injury claims or a free consultation, you should contact an experienced personal injury attorney today. We offer a FREE initial review so you can seek legal counsel, ask all your questions, and get the answers you need without financial obligation.