State Farm, the insurance giant who considers itself to be “like a good neighbor,” has been taking part in some very un-neighborly behavior recently regarding medical-related settlement offers.
One attorney recently submitted more than $12,000 of medical bills to State Farm on behalf of his client–State Farm countered with an offer that was $4,000 less than the cost of the medical expenses alone. Sadly, this is a growing trend in the insurance industry when it comes to car accident victims.
Why Such Low Offers?
First, let’s look at how insurance companies determine what amount is “fair and reasonable” when it comes to pain and suffering. These insurance companies tie the pain and suffering amount into the total cost of medical bills; to be clear, this is an insurance practice and has nothing to do with the law.
The formula State Farm is now telling its adjusters to use (and this goes for other insurance companies as well) is two times the amount of the Medicare rate, with a strong possibility of cutting that amount even more. Do the math, and you’ll find that the amounts that State Farm is offering are unconscionably low…even insulting in some situations.
What Are the Ripple Effects of These Lowball Offers?
Quite simply, more and more medical cases will result in litigation because that’s the only way even to attempt to get someone a fair settlement for their pain and suffering. And we’re not talking egregious sums here–we’re talking about amounts that will simply cover their medical expenses.
The methodology being used by State Farm and its competitors is head-scratching to say the least. A medical case would never be resolved in this manner in a court of law, either by a judge or a jury. The insurance company is hoping the injured will simply accept their offer.
That’s why State Farm even warned its adjusters that this new reduction policy would lead to increased litigation. Some lawyers believe State Farm wants to force every case into litigation with the hopes of making smaller cases unprofitable for both medical professionals and attorneys because of the added time and expense.
What Happens To People With Car Accident Injuries?
Sadly, they could be at the mercy of the insurance company if they don’t get a car accident lawyer to represent them. If doctors and lawyers abandon some of these cases–as State Farm wishfully believes they will do–accident victims have nowhere to turn. So that means insurance premiums will decrease, right? Doubtful.
That leaves the patient–the victim–with the same insurance premium but minimal compensation from the insurance company because doctors and lawyers have given up on these cases, as they’re too costly and time-consuming and ultimately have nothing to show for them.
The insurance company executives? They’ll do just fine for themselves with significant corporate profits and bonuses because that’s really what it’s all about for the insurance companies. And if things keep trending in this direction, the State Farms, Allstates, and GEICOs of the world could become even more prosperous because they might not even need to pay adjusters anymore.
And who gets the short end of the stick? The injured victims.
How A Car Accident Lawyer Can Help With Lowball Offers
Insurance companies like State Farm may play games with their clients, but our attorneys at The Lapidus Law Firm certainly don’t. If you’re the victim of someone else’s negligence in a car accident, call us at (202) 751-5111 or (301) 852-7500 to schedule a free, no-obligation Zoom consultation. We’ll listen to you, and you can count on an honest answer from us.
If we don’t think we can get you a fair settlement offer from the insurance company, we will tell you at NO COST TO YOU. If we do believe we can help, we’ll work relentlessly to try and get you what’s a fair and reasonable settlement–not what the insurance company considers to be fair and reasonable, which is evidently a lowball offer.
We’re here to help. Don’t wait… call us today!