Before turning to successful negotiation strategies, let’s first address several common, but important mistakes that are often made.
Mistake #1: Believing that the representative for the defendant’s insurance company (the “adjuster”) is there to help you and your family. Insurance adjusters receive specialized training in how to delay claims, wear you down, and, if they do their job right, get you to take a “low ball” amount to settle you claim. Insurance adjusters will "make nice" in an effort to make you believe you will be treated fairly and to get you to let your guard down. During the time that the adjuster is making nice, he/she has an investigator working behind the scenes looking for evidence that will weaken or undermine your case. Here again, delay invariably works against in the insurance company’s favor.
Mistake #2: Giving the insurance adjuster your bottom line. All of the work that goes into wearing you down is designed to get you to take a lower amount than you believe is fair and, if you won’t take a low ball offer, to at least give the insurance company your bottom line. It is extremely rare that an insurance adjuster has authority to settle a case for more than a relatively small amount, though they may string you along with vague assurances that they will be making a reasonable settlement offer. By getting you to tell them your bottom line, you may unwittingly have given the insurance company considerable leverage in future negotiations. Case in point: A woman came to use a few years ago who had been trying to negotiate with an insurance company following her husband’s death. She was a stay-at-home mother and relied completely on her husband’s income for support. The insurance company stalled and stalled, which eventually put our client in the position of needing desperately to settle her case so that she would have money to pay her bills. She gave the insurance company her bottom line, thinking that revealing that number would speed things up. Instead, the insurance company only used that as a new starting point for negotiation. When she hired our firm to handle the case and we sent out a new demand for six times what she had requested, the insurance company quickly took the position that it wouldn’t pay any more than what our client said was her bottom line. To make a long story short, we were able to successfully resolve the case for several times what our client said was her bottom line, but it took months longer to change the insurance adjuster’s expectation that our client would eventually take a much lower amount.
Mistake #3: Telling the insurance company that you are having financial difficulties. Many people make this mistake because they believe that the “nice” insurance adjuster will be sympathetic to their plight and be fair and reasonable. The unfortunate reality and is that the insurance adjuster will simply use this information as leverage, knowing that the longer they can drag the case on, the more pressure you’ll be under financially and the more likely it will be that you’ll eventually take a low ball offer.
Mistake #4: Not hiring a forensic economist. A forensic economist is typically an accountant with highly specialized training in determining economic harm. Determining future lost income is often far more complicated than simply multiplying the decedent’s annual income by the number of years he or she was expected to work. In almost all cases, it is necessary to also factor in anticipated future earnings increases from raises, promotions, etc. Lost benefits such as health insurance costs must also be factored in. Not taking these factors into account will result in the loss of tens of thousands—and in some cases hundreds of thousands—of dollars in compensation.
Avoiding those common mistakes is a good first step in successfully resolving a wrongful death case for a fair and reasonable amount. Successful negotiation of a wrongful death case also requires maximizing your own leverage and using that to your advantage (e.g., by conducting a thorough investigation, gathering solid evidence, and having top-notch experts). Another, fairly obvious requirement knowing how to negotiate. Simply put, insurance adjusters make car sales managers look like amateurs when it comes to negotiation.