A demand letter explains why you deserve compensation for your injuries and damages from an at-fault party after an accident. It also formally demands a specific amount to settle your case. Your Fort Worth personal injury lawyer will prepare a settlement demand letter and package to send to the defendant’s insurance company. 

Writing an effective demand letter is crucial. It sets the tone for settlement negotiations. It can also lead to a quick settlement for a fair amount. 

What Does the Insurance Company Do When It Receives a Settlement Demand Letter?

The insurance company reviews the settlement demand letter. It analyzes the claim to determine whether settling the case is in the company’s best interest. The company might weigh several factors when deciding how to respond to a settlement demand letter.

For example, the company might consider the chances of winning a case at trial. It might also consider the cost of going to trial versus the cost of settling the case. The company might also consider various defenses it could raise to dispute the claim, including contributory fault and failure to mitigate damages

Insurance companies generally do not ignore demand letters. Instead, they issue one of three common responses:

  • Denial – The company denies the claim. At this point, your only option might be to file a personal injury lawsuit.
  • Acceptance – The company could accept the settlement demand. If so, your lawyer will prepare a settlement agreement to obtain a settlement check.
  • Counteroffer – A counteroffer rejects the initial settlement offer. However, the insurance company will make a new offer for a lower amount to settle the claim.

Counteroffers are common responses to demand letters. Insurance companies use any tactic available to reduce their liability for injury claims. 

Therefore, your Fort Worth personal injury attorney typically makes an initial offer above the amount you are willing to accept to settle the claim. By doing so, your attorney leaves room to negotiate a fair settlement with the insurance company.

Factors That Affect the Demand Letter Response Time in Texas

Factors that affect how long it takes for an insurance company to respond to a demand letter include:

  • The complexity of the medical records submitted with the letter
  • Whether there is clear evidence and documentation of damages
  • The amount of the settlement offer
  • Whether you hired expert witnesses to assist with the case
  • The insurance policy limits (higher policy limits could put the company at a higher risk at trial)
  • Internal circumstances, such as how many claims the company received and the caseload of the adjuster assigned to your claim 
  • Whether there are disputes regarding fault and liability for damages
  • Other parties that could be liable for your damages 
  • Whether you sustained permanent disabilities or impairments

Each personal injury case is unique. The parties involved and the circumstances of the case can have significant impacts on the timeline for settlement. 

The insurance company involved in the case can be a significant factor. For example, some insurance providers are more willing to settle claims. As a result, they process claims quickly and cut their losses instead of dragging out the case.

However, other insurance companies might engage in bad-faith insurance practices to avoid paying claims. In these cases, the response time to a settlement demand letter could be longer. 

Are There Deadlines for Responding To Demand Letters in Texas Personal Injury Cases?

Texas insurance laws impose specific deadlines for completing steps in an insurance claim. The deadlines are designed to create an efficient and timely process for resolving claims. 

For example, an insurance company has 15 days to acknowledge an initial claim. After that, the company must process and investigate the claim, which could include requesting additional information. 

The company should reject or accept a claim within 15 days of receiving all necessary documentation and information for the claim. However, an insurance company can extend the deadline for many reasons. For example, the insurance company could claim that it has not concluded the investigation and requires additional information to complete its claim evaluation. 

Therefore, these deadlines might not mean much when pursuing a complicated personal injury claim. Typically, the insurance company is rushing to settle, especially if you do not have an attorney. The company might push to settle the claim before you complete medical treatment or speak with a lawyer.

It is not in your best interest to rush to a settlement. Before signing a settlement agreement, talk with a Fort Worth personal injury attorney. 

The insurance adjuster’s job is to pay as little money as possible to settle your claim. A lawyer’s job is to get you as much money as possible for your damages. Make sure you understand the damages you can receive and the value of those damages before you accept a settlement offer

However, there are deadlines for filing claims and lawsuits. Therefore, prompt legal advice can avoid losing your right to pursue a legal claim because of a statute of limitations problem. 

Contact Our Personal Injury Law Firm in Fort Worth, TX

If you’ve been injured in an accident in Fort Worth and need legal help, contact our Fort Worth personal injury lawyers at Stephens Law Personal Injury | Wrongful Death | Truck Accidents to schedule a free consultation.

Stephens Law Personal Injury | Wrongful Death | Truck Accidents
1300 S University Dr # 300
Fort Worth, TX 76107
(817) 420-7000