Negotiating a Personal Injury Claim

What Goes Into a Demand Letter

A demand letter summarizes the case and states the amount being requested. A complete demand package includes a detailed account of the incident establishing how the crash happened and the at-fault party’s responsibility, medical records and bills covering all treatment through the demand date, proof of lost wages including pay stubs and employer verification, and documentation of non-economic losses such as photos of injuries and a pain journal. Supporting reports like accident reconstruction or an economic analysis of future lost earnings are added when needed, along with a specific demand figure and a response deadline, typically 30 days.

The demand figure is deliberately set above what is actually expected. This creates room to negotiate down while still landing above the real minimum threshold. Setting a demand too low signals weakness and anchors the insurer to a lower number from the start.

Insurance Reserves Shape the First Offer

Before a demand letter is even submitted, the adjuster has already set an internal reserve, the amount the company expects to pay on the claim. That number comes from internal software systems and databases, not from a read of the actual medical records, which is part of why an early lowball offer often does not reflect the real value of documented injuries.

Reading the Insurer’s Response

After a demand is submitted, the insurer responds, sometimes with a written counteroffer and sometimes with a letter disputing liability or questioning medical treatment.

First Offers Come In Low

The first offer is almost never the real offer. Adjusters are authorized to pay more than their opening number, but they start low because many claimants accept the first offer out of frustration or misunderstanding.

Partial Dispute Offers

Sometimes the insurer accepts some elements of the demand and disputes others, agreeing on medical bills, for example, while disputing lost wages or rejecting pain and suffering entirely. This response requires a specific, documented reply addressing each disputed point.

Full Denials

A full denial, claiming the insured was not at fault or that the injuries are unrelated to the crash, is sometimes a negotiating position rather than a final decision. It can also be genuine. Either way, a denial often marks the start of a longer negotiation rather than the end of the claim.

What Strengthens Your Position

Pressure is what forces an insurer to take a claim seriously. Clear liability with documented evidence, including crash reports, camera footage, eyewitness accounts, and citations, gives the insurer less to argue. Severe and well-documented injuries, including fractures, surgeries, and permanent impairment ratings, carry far more weight than soft-tissue injuries with subjective complaints alone. Economic damages backed by paper support, such as wage loss verified by employer records and future medical costs supported by a treating physician’s opinion, are hard numbers rather than estimates. An insurer that recognizes a credible willingness to file suit and take a case to trial negotiates differently than one that expects the claimant to accept whatever is offered.

When to Reject an Offer

Knowing when to say no matters as much as knowing how to negotiate. An offer should be rejected before reaching Maximum Medical Improvement, since the full scope of losses cannot be known until the full scope of the injury is known, and any offer made before that point is priced to close the case early. An offer that does not cover documented losses, ignores future medical needs or permanent injury, or is conditioned on signing a release quickly under artificial time pressure should also be rejected.

Inside a Multi-Round Negotiation

• An attorney submits the demand package with documentation, a demand figure, and a 30-day response window, setting the anchor and the evidence base.
• The insurer responds with a counteroffer or dispute, typically 30 to 50 percent of the demand as an opening position, with each disputed item requiring a specific documentary response.
• The attorney responds with a revised demand addressing each dispute point by point, sometimes with additional medical records or a treating physician letter on permanency.
• Numbers converge over a second and third round, or they do not. If the insurer’s ceiling and the claimant’s floor meet in a range that covers the losses, settlement happens; if not, litigation follows.
• A final demand letter before filing suit often accelerates movement, since insurers know litigation is expensive and unpredictable, and a credible filing threat changes the calculation.