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Auto Insurance Claims/How to start a negotiation?

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Expert: - 9/20/2008


Question
Usually there are two ways to start a negotiation for a settlement for an auto accident injury case. One can demand compensation first or the at-fault driver’s insurance makes an offer first. Do you think which way is better for the injured person to start the negotiation, demand compensation first or let the other car insurance make the offer first and why? Thank you for your answer.

Answer
In the end, it probably does not matter too much as the claim rep is going to come up with a settlement range before making any offer or responding to your demand.  He/she is not going to offer anything outside that range regardless who starts.

That being said, you might be able to set the tone and direction of the negotiation by starting first.  You should roughly plan your offers in advance.  Plan on making about 3 counters before you settle, with your movements getting smaller each time.  This indicates you are getting closer to your final offer and the claim rep will recognize this.  The claim rep's job is to try to settle the claim within his/her evaluation range but at the lowest end of it.   

For example, if you think the claim is worth $5,000, you might start at $7,000, the go to $6,000, then $5,500, then $5,000.  Wait for the claim rep to offer more before you lower your demand each time.

Make sure you have written your arguments in advance in brief, one line sentences that you can reference as you negotiate.  Stay calm and professional and do not make it personal.

Auto Insurance Claims

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Claims Guy

Expertise

I am currently an Auto Claims Manager for a large insurance company. I have 18 years experience in the industry, having worked as a Claims Adjuster, Injury Settlement Negotiator, Claims Manager, SIU/Fraud Investigator, and Compliance Officer......I can answer questions related to any aspect of Automobile insurance claims and coverages. I can provide an inside look at how insurers operate. I always treat my customers fairly and want to help make sure you are treated fairly. However, please keep in mind that being treated fairly according to the law does not guarantee that you will get what you want. I can also answer some questions regarding Homeowner's and other types of insurance claims. I have handled all types of auto insurance claims and coverages. I am NOT an automotive repair expert but can give advice re how insurers handle complex repair issues. Please keep in mind that every state has its own set of laws pertaining to rules of the road, liability, and insurance. No one is an expert on every state. I am most familiar with laws in Maryland, DC, West Virginia, and Virginia, but will attempt to answer questions for other states. I am not an attorney an cannot provide legal advice. My advice will be my opinion based on my experience.

Experience

I am currently an Auto Claims Manager for a large insurance company. I have 18 years experience in the industry, having worked as a Claims Adjuster, Injury Settlement Negotiator, Claims Manager, SIU/Fraud Investigator, and Compliance Officer. I am not an attorney an cannot provide legal advice. My advice will be my opinion based on my experience.

Organizations
CPCU Society. Adjusters license in multiple states. International Association of Specal Investigators

Education/Credentials
I have a B.S. in Finance and have completed the AIC and CPCU designations.

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