Brief Summary: Here is a little secret you do not often hear from attorneys: While it’s not a great idea, most car accident settlements can be obtained without a lawyer. However, if you sustain serious injuries in an auto accident, you should consult an attorney before settling your case with an insurance company. In this blog, the experienced California car accident lawyers from Wisner Baum walk you through the process of pursuing a car accident claim, from start to finish. We will discuss the ins and outs of how car accident settlements work, how much money you may get from a California car accident settlement, and much more.
How a Car Accident Settlement Works
What is a Car Accident Settlement?
What is Included in a Car Accident Settlement?
Who Pays for Car Accident Settlements?
Average Settlement for Car Accident in California
How Car Accident Settlements Work – What to Expect
How Long Does it Take to be Paid After a California Car Accident?
Do You Need a Lawyer for a Car Accident Settlement?
How to Find the Best Car Accident Lawyer for Your Case
Los Angeles Accident Attorneys with Proven Track Record
What is a Car Accident Settlement?
A car accident settlement refers to an agreement reached between all relevant parties involved in an auto accident, including insurance companies, the victim(s), and any other person or entity that may have been negligent. Negligence in a car accident refers to the failure of one of the parties to exercise proper care while operating a vehicle, resulting in harm or damage to another person or their property. Some examples of negligence in a car crash include speeding, distracted driving, road rage, drunk driving, or violating traffic rules.
A settlement aims to compensate the victim (or victims) for any damages incurred due to the accident. The agreement is the document which sets out all of the terms of the settlement. These damages may include pain and suffering, medical expenses, property damage, loss of consortium, and other related costs.
Compensation arising from a car accident is carefully determined by considering all the relevant facts that surround the accident. The parties involved must mutually understand and agree on the terms of the agreement. If an agreement cannot be reached, a car accident lawsuit may be filed and the case could head to trial.
What is Included in a Car Accident Settlement?
If another party's negligence caused an accident, the you may be entitled to receive compensation in the form of “damages.” While your claims for damages vary based on the circumstances of the crash, economic and non-economic damages may be available to you in California:
- Damages for pain and suffering
- Medical expenses (past and future)
- Car repairs
- Property damage
- Lost wages due to missing work
- Inability to pursue a career (if your car accident injuries were so severe that you cannot physically pursue your intended career)
- Loss of earning capacity
- Loss of consortium
Economic Damages in a Car Accident
Compensatory damages, also known as economic damages, encompass the losses experienced by victims as a result of a car accident. These damages aim to reimburse individuals for the tangible and calculable losses they have suffered due to the incident, including:
- Past and future medical expenses: Includes health treatments (including mental health), prescription drugs, home healthcare, physical therapy, and more.
- Property damage: Includes the costs of repairing or replacing damaged vehicles and any personal belongings damaged in the wreck.
- Lost wages and loss of earning capacity: Includes compensation to victims for their inability to work temporarily or permanently due to their car crash injuries.
Non-Economic Damages in a Car Accident
Another category of damages, known as non-economic damages, compensates victims for the physical, emotional, and psychological harm caused by someone else's negligent actions. These are designed to compensate accident victims for the impact the accident had on their lives. Non-economic damages may include:
- Pain and suffering experienced by the victim. Pain and suffering is a legal term referring to the physical and emotional distress someone experiences from a catastrophic injury caused by negligence. It includes the physical pain a person endures from the time of the crash onward as well as the emotional anguish they experience. Post-traumatic stress disorder is one example of a psychological injury that may arise from a car accident.
- Loss of enjoyment of life: Accident injuries may not cause physical harm exclusively. Car crash injuries may also impact a person's quality of life, mental well-being, and ability to enjoy daily activities. In legal cases, individuals may seek compensation to help alleviate the negative effects caused by their injuries.
- Loss of consortium: Refers to the impact on the victim's ability to fulfill familial and spousal responsibilities and support. Some states like California allow for loss of consortium while others do not.
Punitive Damages in a Car Accident
In the aftermath of a car accident in California, punitive damages may be awarded to the victim under specific circumstances. Unlike the typical damages that cover medical expenses and property damage, punitive damages serve as a form of punishment against the at-fault party.
In California, punitive damages only apply when there is clear and convincing evidence that the defendant displayed deliberate malfeasance and engaged in acts of “oppression, fraud, or malice” against the victim. Put more simply, the defendant's actions must go beyond ordinary negligence and demonstrate a level of deliberate, reckless misconduct.
The amount of punitive damages available in a case is a subjective matter left to the jury or the court’s discretion. However, California law restricts the total amount to no more than nine times the actual damages awarded. It is worth noting that punitive damages are primarily aimed at discouraging malevolent behavior rather than directly compensating for the car accident itself.
While punitive damages in California car accident cases are rare, when they are awarded, the cases most commonly involve defendants driving under the influence of drugs or alcohol. Although the defendant may not have intended to harm others, the voluntary decision to operate a motor vehicle while intoxicated may constitute sufficient malice to warrant punitive damages.
In such instances, the defendant may find themselves facing both a criminal DUI case and a civil personal injury lawsuit. This adds an extra layer of legal consequences, as the punitive damages serve as a separate punishment from any criminal charges.
It is important to note that automobile insurance and many other types of insurance do not pay an award of punitive damages and will not pay for any act that is considered intentional, such as in some road rage scenarios. In such circumstances, the punitive damages award would be paid by the bad actor personally.
Who Pays for a Car Accident Settlement?
In most instances, while the at-fault driver caused or contributed to the car accident, they are not necessarily going to be paying your damages themselves, unless punitive damages are involved (more on this in the above section on punitive damages). Instead the at-fault driver’s auto insurance company will be paying out the claim, whether that is via settlement or via a lawsuit and, if necessary, trial. The amount you recover may be limited by the insurance coverage the at-fault driver has available unless the driver has assets and can contribute to the settlement.
Average Settlement for Car Accident in California
As discussed above, it is difficult to project how much to expect from a car accident settlement because all cases are different and involve different claims for damages.
Data from the Insurance Information Institute shows that the average claim for personal injury after a car accident is around $20,235 and the average claim for property damage is around $4,700. A recent survey conducted by the legal organization Martindale-Nolo found that the average car accident settlement was $23,900. However, most people who participated in the survey received a settlement below $10,000.
As for neck and back injuries, Forbes recently reported that “the median settlement amount in the U.S. for a neck and back injury is probably somewhere between $100,000 and $500,000.” It is important to note that the article does not say these figures are specific to car accident settlements for neck and back injuries, so the figure is likely more general to personal injury cases.
How Car Accident Settlements Work – What to Expect
While each car accident claim in California is different, they generally follow these steps.
Investigation and Evaluation of Car Accident Claim
After you or your attorney files an accident claim with the insurance company, the insurer will undertake an investigation into the circumstances surrounding the crash. If you retain a lawyer, they will begin to build your case by collecting evidence, obtaining a police report (if one is generated), getting witness statements, medical records, and more.
In the early stages, the insurer may offer you a settlement worth less than your claim’s value. This is where having an experienced car accident lawyer on your side is vital, as he or she will be able to advise you on whether the settlement offer fully and fairly compensates you for your losses. Remember: insurance companies are not interested in paying out the full value of car accident claims. They are more concerned with protecting their bottom line.
Demand Letter and Settlement Negotiations
If you hire an attorney, they will send a demand letter to the at-fault driver’s insurance company. A demand letter includes the facts of the case, including the legal reason why the at-fault insured driver is to blame, and makes a “demand” for compensation based on the type and extent of your injuries. After reviewing the demand letter, the insurance company may offer a settlement.
In some cases, the insurer may deny your accident claim because they do not believe your accident is covered by their policy. The insurer may also find that your claim contains errors (this is more common when accident victims do not hire an attorney to represent their interests). If the insurance company denies the claim and the auto accident left you with serious injuries and/or damage to your vehicle, you need to consult with a car accident lawyer as soon as you are able.
If the insurer approves your claim, it does not necessarily mean that you will receive full and fair compensation. The approval simply means that, based on the investigation, the insurer agrees that your claims for damages are covered by the insurance policy. If you are happy with the auto settlement amount, your case is effectively over. However, if you remain unsatisfied with the settlement offer, you can choose to pursue a car accident lawsuit.
Filing a Car Accident Lawsuit
The overwhelming majority of accident claims are resolved via settlement, and your chances of securing a favorable settlement are better with an experienced attorney representing you. However, if you are unhappy after settlement negotiations, you and your attorney may choose to file a civil lawsuit. California has a statute of limitations of two years for car accidents, which means you will need to file a “complaint” in court within two years of the accident date. A complaint contains the facts of the case, the allegations, and the “prayer for relief,” where the plaintiff states the damages or other remedies sought from the defendant(s). Once the defendant is served with the complaint, they have 30-days to respond.
Your car accident lawyer will ensure you understand these rules and how they might affect the length of time it takes to resolve your case.
Pretrial Phase
After your case is filed, the parties will enter a pretrial phase known as discovery, which is a part of the legal process where both sides seek to obtain information about the case, including written requests for information and documents, depositions, medical records, and more. If liability for the accident is disputed, your attorney may hire experts to strengthen your case.
During this time, both sides may still discuss settling the case. If the parties still cannot settle, the judge overseeing the case may order mediation, which is a type of alternative dispute resolution.
Trial
If the parties involved in the dispute cannot agree to a settlement, the case will proceed to trial. The duration of the trial will depend on how many witnesses need to testify and how complex the arguments are. It could last anywhere from one day to weeks or more.
During the trial, your car accident lawyer will give an opening argument, followed by the defense attorney’s opening. After that, your attorney will have the opportunity to present evidence and call witnesses. Your lawyer will ask your witnesses questions first, and then the defendant's lawyer will have the chance to cross-examine them. The defense will also have the opportunity to present evidence and bring their witnesses. Your lawyer will be able to cross-examine any witnesses brought by the defense.
Finally, both sides will give a closing argument, where they will ask the judge or jury to decide in their favor. If the trial involves a jury, the judge will explain the laws that apply to the case to the jury. The jury will then discuss and decide the case, which is called a verdict.
You will be compensated if you win, though the defendant may appeal the verdict. If the outcome is not in your favor, there may be situations where you can challenge the decision and appeal it.
How Long Does it Take to be Paid After a California Car Accident?
In most California car accident claims, you can expect to receive a payment within six weeks. The auto insurance company has 15 days to acknowledge receiving your claim and another 40 days to accept or deny the claim. Per California law, if you and the insurance company come to a fair agreement on your claim, the company must pay out the claim within 30 days. Based on that timeframe, car insurers will approve or deny the crash settlement within 85 days.
If your car accident lawyer files a civil lawsuit on your behalf and the case goes to trial, it might take longer for you to reach a settlement and receive payment. Some cases last months or longer. Your attorney will advise you on the timetable for your case, including when you can expect to be paid.
Do You Need a Lawyer for a Car Accident Settlement?
If your injuries are significant and your car was severely damaged in a car wreck, we recommend contacting an experienced lawyer to help you pursue the compensation you deserve, whether that is via a settlement or taking the case to trial.
Auto accident claims can be complex and confusing, especially if the case involves multiple victims and defendants. Research conducted by the Insurance Research Council found that the average person receives a settlement more than three times larger when they retain a personal injury lawyer to represent their interests after an accident. An experienced car accident lawyer helps level the playing field when the stakes are high and allows you to focus on healing from your injuries.
That said, most car accidents are considered minor, meaning no one was seriously injured and any vehicle damage is not significant. Under these circumstances, you may not need an attorney to represent you. One thing to remember: if you pursue a car accident claim without a lawyer, you will need to let the insurance company know of your intent to file a claim as soon as you can. The statute of limitations for a California car accident is two years from the date of the accident, though there may be exceptions.
How to Find the Best Car Accident Lawyer for Your Case
Below are some of the qualities you should consider when researching the best car accident lawyer for your claim:
- Consider the law firm's longevity, size, and experience. Look for awards and leadership roles as indicators of credibility.
- Evaluate the complete team of staff, not just the partners or public faces. Keep in mind that the person you initially speak to may not be your primary contact.
- Determine their comfort with going to trial. Find out how many of their cases go to trial and their success rate. Any lawyer you consider hiring should have sharable results in cases similar to yours.
- Look for lawyers who have tried or settled similar cases in your area.
- Assess their negotiation ability. Most car accident cases are resolved via mediation. Review the firm’s top settlements in similar cases.
- Evaluate your personal comfort level with the lawyer. It is essential that you feel at ease working with them.
- Ask questions about their caseload to ensure they can devote the appropriate amount of time needed to win your case.
- Read client reviews, especially on independent review sites like Google and Yelp, to understand what others have to say about their services.
California Accident Attorneys with Proven Track Record
If you or a family member sustained serious injuries in an accident caused by another driver’s negligence, you may be able to seek compensation from the driver, the vehicle manufacturer, or any other responsible parties. At Wisner Baum, we have been helping car crash victims get the justice and compensation they deserve for roughly 40 years. With over $4 billion won for our clients, our track record of success in complex litigation speaks for itself. While our firm is based in Los Angeles, California, we have offices throughout the state.
Put your case in the hands of proven litigators. Schedule your free consultation with our trusted Los Angeles car accident lawyers by calling (855) 948-5098 or contacting us online.
