If you are injured in an accident that was caused by someone else’s negligence, you may have a personal injury claim. To get compensation for your injuries, damages, and losses, you will need to either settle your personal injury case out of court or win a judgment through a personal injury lawsuit.
The legal process of collecting your personal injury settlement or judgment involves multiple steps – from finalizing the settlement agreement or court order, addressing any liens, and getting the insurance companies to issue payment. Understanding this process can help you know what to expect and get the settlement money you deserve.
Understanding Personal Injury Settlements and Judgments
A personal injury settlement is the compensation you accept to resolve your injury claim outside court. Settlements are negotiated between the injured plaintiff (or their personal injury attorney) and the at-fault defendant’s insurance company.
A personal injury judgment is the damages amount awarded if you win your case in court. A judge or jury decides judgments after hearing all evidence during a trial.
The main differences between settlements and judgments are:
- Settlements are agreed to voluntarily by both parties, while a court imposes judgments.
- Settlement amounts may be lower but provide guaranteed money faster, while judgments may be higher but take longer.
- Defendants can appeal judgments and delay payment but cannot appeal settlements.
How is a Personal Injury Settlement Amount Determined?
Suppose you file a personal injury lawsuit after being injured. In that case, the ultimate goal is to reach a settlement agreement before trial. The settlement amount will be determined based on:
- The severity of your injuries and how they have affected your life
- The liability of the defendant and whether they were clearly at fault
- The amount of available insurance coverage
- Lost income and future loss of earning capacity
- Pain and suffering damages
- Your credibility and ability to prove damages
The at-fault party’s insurance company will likely make an initial low offer. Your personal injury attorney can then negotiate to get you the maximum settlement based on the value of your case.
The Step-By-Step Process of Receiving a Settlement Check
Below is an outline of the typical key steps you’ll go through from the time you get injured until you receive your settlement check:
1. Filing a Personal Injury Lawsuit
The process starts by consulting and retaining a personal injury lawyer. They will investigate your claim, determine its viability, and advise you on the options available.
If your claim has legal merit, your lawyer will file a personal injury lawsuit on your behalf against the at-fault party. This formally starts the legal process toward getting compensation.
2. The Role of a Personal Injury Lawyer
Your personal injury lawyer will be your guide through the complex legal process:
Gather evidence to build a strong claim, including police reports, medical records, and witness statements.
Negotiate with insurance adjusters to seek a fair settlement offer.
Navigate court procedures like hearings, depositions, and pre-trial motions.
Determine a reasonable settlement amount that covers your damages.
Draft and finalize the settlement terms and release forms.
Having an experienced lawyer handling these aspects is vital for maximizing your compensation.
3. Understanding the Personal Injury Claims Process
The personal injury claims process has several standard steps after filing the lawsuit:
The defendant responds to the lawsuit within the period set by court rules, usually 30 days.
Your lawyer and the defendant’s legal team conduct investigations to establish facts about the incident through interviews, documents, site visits, and expert input.
They may also conduct depositions where parties and witnesses answer questions under oath.
Both legal teams file pre-trial motions to argue legal aspects like admissibility of evidence.
They also engage in settlement negotiations to avoid a trial. Most personal injury suits settle out of court.
4. A Look at the Typical Settlement Check Timeline
Every personal injury claim has a unique timeline based on its complexities. However, below is an outline of the typical timeframes as your claim progresses:
1-6 months: Investigation and evidence gathering.
6-12 months: Filing motions, deposing witnesses, negotiations, and settlement.
12-18 months: Additional negotiations if initial settlement fails.
18-24 months: Pre-trial preparations and possible trial if negotiations fail.
24+ months: Appeals process if either party contests the trial verdict.
So in standard cases with no complications, you can expect to get your settlement check in 6-12 months after filing your claim. Complex cases take longer.
Key Legal Aspects of Receiving a Settlement Check
There are crucial legal considerations during the settlement phase that determine your check amount and when you receive it:
1. Understanding Legal Settlements
A settlement legally ends your claim against the defendant. It involves:
An agreed-upon settlement amount.
Signing release forms discharging the defendant from further liability.
Abiding by confidentiality and non-disclosure agreements on case details.
Meeting any negotiated settlement terms.
Refusing the settlement means heading to trial instead.
2. Determining Settlement Amounts
Your lawyer will calculate and negotiate the settlement amount based on:
Documented medical costs.
Detailed calculations of lost income and future losses.
Assessments of pain and suffering damages.
Legal fees and expenses spent on depositions, expert witnesses, case preparation, etc.
The defendant’s insurer uses adjusted formulas to determine what they view as acceptable payouts. Significant back-and-forth negotiation usually happens before both parties compromise on an amount.
3. The Importance of Settlement Terms and Release Forms
The settlement documents legally protect both you and the defendant and are crucial to review before signing.
Release forms end all your claims related to the incident and parties involved. This protects the defendant from you suing again later for more compensation.
A confidentiality clause maintains secrecy around case details. This benefits the defendant’s reputation.
A non-disclosure agreement prohibits revealing sensitive case information like settlement amount. This prevents external scrutiny of the defendant’s willingness to pay.
Consult thoroughly with your lawyer before signing these forms.
How Long Does It Take to Receive Settlement Money?
Many factors affect the timeline for receiving your personal injury settlement check after agreeing to a settlement, including:
- How long negotiations take – This can range from weeks to months depending on the complexity of your case.
- Lien resolution – Any outstanding medical bills or liens attached to your case must be negotiated and paid out of the settlement funds first.
- Court approval – The judge must approve settlements for minors and sometimes for adults in certain cases. This can take 30-60 days.
- Check processing – Once approved, the settlement check takes about 2 weeks to be issued and mailed.
Under normal circumstances, it takes 2-3 months to receive your check from the time a settlement agreement is reached. Complex cases with liens to resolve can take 4-6 months. Ask your attorney for a realistic timeframe for your specific situation.
Will Creditors or Liens Take My Settlement Money?
Unfortunately, creditors may try to take a portion of your personal injury settlement funds through garnishment if you owe them money. Typical liens that could be deducted from a settlement include:
- Medical liens – For medical bills related to treating your accident injuries.
- Insurance liens – If an insurance company paid benefits on your behalf for the accident.
- Attorney liens – Your lawyer will take their fee percentage from the settlement upfront.
- Child support liens.
Your personal injury lawyer should negotiate all liens down as much as possible and resolve them prior to you receiving the net settlement amount. Be upfront about any liens or owed debts from the start.
What Should I Do With My Settlement Check?
When your personal injury settlement check finally arrives, you may be eager to cash it right away. But not so fast! Here are some important steps:
- Notify your attorney – Let your lawyer know the check arrived and have them review it. Verify that all lien payments were made correctly.
- Pay off medical bills – Use the settlement funds to immediately pay for any accident-related medical bills not already covered by liens paid out of the settlement.
- Set aside for taxes – Put at least 20-25% of the total in a savings account for taxes. Personal injury settlements are taxable income.
- Invest wisely – Consider putting a portion in stable investments to secure your financial future. Discuss options with a financial advisor.
- Make purchases – It may be tempting to make big purchases, but avoid splurging on depreciating assets. Focus purchases on necessities.
Finalizing the Settlement or Judgment
Settling a personal injury case out of court involves back-and-forth negotiations between your attorney and the insurance company to agree on the settlement terms. Once both sides sign the settlement agreement, the case concludes.
If you win a judgment in a personal injury trial, the at-fault defendant may file appeals. If no appeals are filed or the judgment is upheld, it becomes final after 30 or 60 days. The court will issue a final order for the judgment amount.
Addressing Liens and Outstanding Payments
Before you can collect your settlement or judgment, any liens against it must be paid.
- Medical liens – Healthcare providers may have a lien to get reimbursed for accident-related bills from your settlement.
- Government liens – Medicaid, Medicare, or worker’s comp may have a lien to recover benefits paid.
- Attorney’s fees – Your lawyer will take their contracted percentage from your total recovery.
Resolving these liens and payments can take weeks or months. Your attorney handles this process to ensure you receive the remaining settlement amount.
Receiving the Settlement Check
Once any liens are addressed, the insurance company will issue your settlement check. If you won a court judgment, the defendant’s insurer is legally obligated to pay the judgment amount.
After finalizing a settlement agreement, receiving your settlement check can take 30-60 days. Judgment processing may take several months if the defendant appeals or hides assets. A personal injury lawyer can pursue legal actions if needed to get your money.
Collecting a Judgment
If a defendant refuses to pay a judgment, collecting it requires tracing their assets. Options for collecting a personal injury judgment include:
- Garnishment – Taking funds from the defendant’s bank accounts or paychecks.
- Seizing and selling assets – Cars, property, or other valuables owned by the defendant may be seized.
- Conducting debtor’s exams – Questioning the defendant under oath about their finances.
- Placing liens on property – Preventing the defendant from selling assets until the judgment is paid.
Your attorney will determine the most effective legal avenues for forcing the defendant to pay the court-ordered judgment.
Working with a Personal Injury Lawyer
Having an experienced personal injury attorney represent you throughout the settlement or judgment process is strongly recommended. A knowledgeable lawyer can assist with:
- Maximizing your settlement through skillful negotiations
- Navigating court procedures if a trial and judgment are needed
- Resolving any liens against your recovery
- Drafting and reviewing the settlement agreement
- Collecting a judgment through legal enforcement methods if needed
Key Takeaways on Receiving Personal Injury Settlements
- The settlement process often takes 2-4 months from the agreement date to receiving your check.
- Liens from medical providers or insurers will be paid out of the settlement funds first.
- Carefully consider how to handle the money when you get your check.
- Personal injury settlements are taxable income so set aside money to pay taxes.
- Creditors may attempt to garnish your settlement to collect on unpaid debts.
Understanding the ins and outs of receiving a settlement payout will help you make smart decisions and maximize the compensation you deserve. An experienced personal injury attorney can fully advise you throughout this process.