Your 6-Step Guide to Negotiating Your Auto Accident Case Like a Pro

The following is adapted from my new book, Not a Good Neighbor.

Ten years ago, insurance adjusters were trained to evaluate injury claims according to three things: liability (who was at fault), damages (how badly was someone hurt), and coverage (how much insurance each driver had). They added up these factors and determined the best course of action to get the case settled for as little money as possible.

Today, things are different. Insurance companies rely less on well-trained people weighing all the factors in an accident and more on artificial intelligence (AI) to determine how much a case is worth. Insurance companies still use human adjusters, but those adjusters have lost all authority to do anything.

This new reality means you can negotiate your auto accident case for the highest settlement possible. Here are six steps that will help you do that.

#1: Understand the Game

There are three AI systems in use by insurance companies today, but the most frequently used one is called Colossus. Colossus reviews data from your case but also looks at the whole schema of injuries in the world and all the past verdicts of similar cases over the years and decides what your claim is worth. That amount is what the adjuster goes with.

Insurance companies will tell you that the Colossus number is not the final determination. They insist it’s merely advisory because if they admitted it was definitive, then opposing parties could fight them on a bad faith claim. 

If a case goes to litigation, most judges will say that the insurance company can’t rely on Colossus to beat a bad faith case. You have to rely on human judgment, so you have to put an adjuster on the stand and have them explain why they did what they did. Insurance companies can’t rely on AI to justify your actions.

#2: Provide the Data Colossus Needs

What does all this mean for someone who is trying to settle their own auto accident case without an attorney? It means you have to provide the data that’s needed for Colossus or some other AI program to give you a better-than-average outcome. 

That means providing the at-fault driver’s insurance adjuster with everything: repair costs with part numbers listed in detail and hours worked on the repair, medical bills (including every treatment date with the CPT codes for every single treatment and every doctor’s visit), future medical costs listed in detail (including the future costs of each part of the surgery), and any lost-wage information (including your wage statements and tax returns).

Every bit of information you provide will help Colossus spit out a decent offer. The more data Colossus has, the more it increases the value of your case.

#3: Build Your Own Case

Your job isn’t over once you’ve given an insurance company as much data as possible. As one of the drivers, you have to do many of the same things an adjuster for the at-fault driver is doing. You have to look at coverage, liability, and damages.

That means taking photos of the accident, getting statements from witnesses as well as their contact information, and getting the responding police officer to issue a ticket to the other driver. Talk to the driver and get them to apologize to you if you can. If you can get them to apologize in a quick video, all the better. 

The more you can prove that someone else is 100 percent at fault, the stronger your case will be. If you were hit from behind because the driver was distracted by their phone, see if you can get them to admit that. This opens them up to punitive damages and enhances the value of the case.

You also need to call your own insurance company right away. They will want to discuss the property damage and get a statement from you proving that you were not at fault.

#4: Create a Demand Letter

Your demand letter is the culmination of building your case. It’s not something you sit down to write the evening of your accident. It’s a compilation of all the communications and information you’ve sent the insurance adjuster in the days and weeks following your accident. 

Plan on sending the at-fault driver’s adjuster an introductory letter within five days of the accident. Explain who you are, that you’re injured, and whether you’ve been to the emergency room or doctor. Give the adjuster the name of all your doctors, promise to send them medical records as soon as you receive them, and invite them to contact you if they need additional information.

Sixty days after your accident, send the adjuster an update. Give them any additional medical records and let them know how you continue to suffer from the accident. Inform them of upcoming medical needs that resulted from the accident. Enclose copies of all your medical bills and payments. Send them a log of what’s been paid by the PIP insurance. Explain how you plan to pay for medical treatments after your PIP runs out.

It’s crucial that you put a time limit on your demand letter. In our law office, we give the adjuster thirty days to respond, and you can ask them to get back to you in that time frame as well. That will give the adjuster time to review your case and get back to you with a counteroffer.

#5: Start the Negotiation Process

That counteroffer signals the start of the negotiation process. In all likelihood, the adjuster’s counteroffer is going to be considerably lower than your initial offer. The best way to handle this is to tell the adjuster that you want to consult with your attorney or some other advisor and that you will get back to them. 

This gives you a little breathing room, but it also gives you the opportunity to talk the offer over with someone. That person could be an attorney, but it could also be your spouse, a friend, or a grandparent. Explain the situation to them and ask their help in formulating a counteroffer.

You should come up with a range for a settlement. Figure out what the best result is likely to be, and decide what your minimum acceptable value will be. In other words, what “final offer” from the adjuster would convince you to break off negotiations and hire an attorney?

#6: Use Online Resources to Help You With Your Case

There are some online resources that can help you determine your case’s value. VerdictSearch provides online tools that estimate damages, analyze insurers’ settlement offers, and project the likelihood of winning at trial. Thomson Reuters offers its Westlaw Edge service to help assess the value of your case and evaluate the reasonableness of the adjuster’s offer.

Some people may feel like they’ve emptied their magazine in their demand letter and have little ammunition left for negotiating with the adjuster. However, the adjuster’s response is going to give you fresh ammunition. 

Remember, negotiation is really about resolving disputes. It will help your negotiations if you personally and privately decide beforehand those issues on which you’re willing to concede and those on which you intend to stand firm.

As you go back and forth, remain professional. Be prepared to explain how you arrived at your numbers so that your settlement offer appears to be well-reasoned and not arbitrary. 

Make Them Believe You Know What You’re Doing

The key is getting the adjuster to respect that you know what you’re doing. You need to come up with a logical, fair, and appropriate settlement value and justify it to the adjuster. 

The best way to get a good settlement is to approach negotiations the way a lawyer would. By following these six steps, you’ll be doing exactly that—and that will help you get the best possible outcome for your case.

For more advice on negotiating a successful settlement, you can find Not a Good Neighbor on Amazon.

Brian LaBovick is a lawyer and entrepreneur who has earned more than $400 million for his clients after establishing his injury law practice in 1991. As one of two students selected to the prestigious Order of the Barrister as the outstanding litigator in his class at the University of Miami, Brian was hired by the US Department of Justice Honors Graduate Program after graduation. He is now CEO of the LaBovick Law Group, an advisory board member of Keiser University’s legal education division, a past president of the North Palm Beach County Bar Association, and former director of the Palm Beach County Justice Association.