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Settlement Agreement

Definition - What does Settlement Agreement mean?

A settlement agreement can be a written or verbal settlement between two or more parties who have assented to a certain offer in a personal injury case.

When can I file an injury case?

Claimants who are injured from the negligent actions of another person or entity may have the right to file an injury claim to request compensation for their medical expenses, lost wages, and pain and suffering. They may also have the right to compensation for punitive damages.

Most personal injury lawsuits, however, do not end in court but are settled by both parties through a settlement agreement.

Considerations before accepting a settlement agreement?

In personal injury claims settlement agreements are offered by the defendant or the defendant’s insurance company. Before refusing the settlement offered through the agreement the plaintiff should consider how much they could expect to win at trial if the injury claim was settled in court. For example, if you have been injured by a defendant with little or no money or insurance you are unlikely to win much money even if the case goes to court. In this case, accepting a settlement agreement might be the best course of action.

If, however, the defendant has a good insurance policy with high policy limits, you will not need to consider limits of the payout before deciding whether or not to accept a settlement offer.

Other considerations before accepting a settlement agreement

Other issues to consider before refusing a settlement agreement include how much you need the money. For example, a plaintiff may be more eager to accept a settlement agreement if they are desperate for cash, and they do not want to wait months or years to get paid.

Additionally, there are state laws to consider when analyzing settlement offers. Some states have instituted litigation settlement rules, which can be complicated and can vary by state. For example, in certain states if the defendant offers a settlement and the plaintiff refuses and counters with a higher offer, if the case goes to trial and the amount awarded by the court to the plaintiff is equal to or less than the initial settlement offer, the plaintiff may be forced to pay certain costs such as the attorney’s fees for the defendant.

Finally, if your lawyer seems too eager to settle and you are not sure the settlement offered in the settlement agreement is sufficient, accepting the settlement offer may not be a good idea. Although it does not happen too often, some lawyers will try to get their clients to accept low offers so the lawyer can receive a quick payout and avoid taking the case to trial.

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