The legal definition for a claim is “a demand for money, property, or the enforcement of a right provided by law.” When you are involved in an accident, you file a personal injury claim because you feel that you have a right to monetary compensation at someone else’s expense. This may be because the accident was another driver’s fault or because your insurance company is liable.
In a personal injury claim, the injured party seeks financial compensation from the party they feel is liable. There is almost always an attempt to settle a claim outside of court to avoid the fees and hassle. If both parties cannot agree on liability or a fair amount, the case is then presented to a court to decide. This is called litigation.
The process begins by notifying the insurance company of the intent to pursue the claim for injuries and damages. The insurance company is kept informed about the injuries and damages. When the injured party has completed treatment, or the time is right if still treating, the injured party sends what is known as a demand letter to the insurance company. As you may have guessed, this letter demands a certain amount of money as compensation for the damages.
A demand letter lays out the significant points to the claim in an effort either to resolve the case immediately or to present to the other side the claim against them. Demand letters often include:
The defendant’s claimed liability
Injuries the plaintiff suffered
Treatments costs for those injuries
Lost income from time off work
Any other damages, like pain and suffering
The insurance company will then review the claim and decide whether or not they are willing to meet the demand. Most likely, they will reply with a counteroffer. They may also decide that they will not pay any of the damages. This generally happens for the following reasons:
They don’t think they are liable, either because the accident wasn’t their insured’s fault or because their policy doesn’t cover the incident.
They feel there is a lack of evidence to support the claims made in the demand.
They have reason to believe that the injuries reported were not caused by the incident and instead occurred either before or after the accident.
If the insurance company won’t pay—or won’t pay what the injured party thinks is fair—then the injured party and their attorney may move on to the next step in the process: filing a lawsuit.