Negotiation Steps on the Way to Your Injury Settlement...

No negotiation steps are set in stone when it comes to dealing with insurance companies. But they almost always take the same basic shape.

Beyond the basic framework of negotiating insurance settlements, there are a few sneaky tactics the insurance claim adjuster might use. Adjusters have been known to use intimidation and distort the truth.

First of the negotiation steps is something we've already looked at in great detail. This is your personal injury demand letter.

First you write a short letter indicating you were injured and may make a claim at some point in the future. This is your letter of notification. Then you write the injury demand letter, which formally opens the insurance claim.

That letter lays out the groundwork for all future negotiations. It also makes the first request for a specific amount of money. This amount of money should be high, but within reason. Make sure the amount is higher than you expect to receive.

After this letter has been reviewed by the adjuster, you'll get a letter or a phone call telling you why your claim won't work. They'll question liability and try to de-emphasize their client's negligence.

This is also where they'll try to put the liability partly on you. If your medical bills show payment for treatments they don't agree with, this will also come up. These treatments could include anything from alternative medicine to prolonged physical therapy.

This is the time you'll probably face most of the intimidation tactics. The adjuster will try to tell you how things work and how your demand doesn't fit their protocol. Let them go on as much as they want, but when they're done you'll have a chance to respond.

The next step in the negotiation process will be when you address their arguments. You'll defend your bills, your lack of liability and re-state your actual demand. Assuming you've done even a remotely good job so far, this is the point where the adjuster makes their first offer. Almost without question this will be a very low offer, used to test the waters.

If you're in a real hurry for the money, which is what they hope, you'll take their offer and run.

But instead of doing that, you'll show them you have the patience to deal with all the negotiation steps. Turn down their offer, but give in a little bit. Your demand was purposely too high, so now you'll be able to agree with them a little and make a new offer.

If you put up a good enough case, and the threat of a lawsuit is a real possiblity, the adjuster just might settle with you right there. Normally, the negotiation process will call for yet another offer on their part.

From there, the back and forth bartering continues.

Remember, there are no negotiation rules that say you have to keep lowering your offer. Of course there's a limit to how low you're willing to go. If the adjuster refuses to settle higher than your lowest acceptable amount, you can keep turning their offers down.

If they refuse to offer a minimum personal injury settlement amount you're willing to accept, then you may have to file a formal civil lawsuit. This is the last of the negotiation steps. An insurance company will often increase their offer once they receive paperwork notifying them of a pending lawsuit. And they may continue to raise their offer as the lawsuit progresses.