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After an injured victim has filed a claim with the insurance company of the responsible party, the insurer assigns the case to an adjuster. The personal injury lawyer St John’s is aware that the adjuster must determine the accident’s value.

What are the damages, which help to decide the accident’s value?

• The medical expenses
• The lost income
• Any permanent disability or disfigurement
• Loss of time with the family; loss of social experiences
• Missed opportunities, such as school or training
• Missed vacation time
• Loss of the ability to enjoy a favored recreation activity, or a hobby
• Pain and suffering
• Any damaged property

What is the formula that insurance adjusters use, when trying to assess the value of a given accident?

Each adjuster adds up the total medical expenses for the claimant that has filed a particular case. That total represents the value of the special damages.

Each adjuster multiplies the special damages by a figure that corresponds with the claimant’s pain and suffering. That figure differs from case to case, although it usually falls within a range of 1.5 to 5.

If the accident had caused only minor injuries, the figure of 1.5 would be the factor by which the special damages were multiplied. If the accident-caused injuries had burdened the victim with a permanent disability or disfigurement, then the adjuster’s chosen factor would be at least a 5, if not a higher figure.

Once each adjuster has calculated the product for multiplication of the special damages and the selected factor, then that calculated product gets used in another equation. That product is added to the value for the victim’s lost income.

The total obtained by adding the calculated product and the lost income provides the adjuster with an important figure. That represents the amount of money that gives adjusters a feel for the proper size of their initial offer.

What happens after the presentation of that initial offer?

At that point, the claimant/victim studies the extent to which that first offer differs from the amount demanded. Usually, it is much lower than the amount quoted in the demand letter. Consequently, the claimant’s counteroffer should be well above the adjuster’s proposed offer. Ideally, when the adjuster learns the size of the claimant’s counteroffer, the adjuster next proposal is made. That is normally higher than the first one, but still lower than the counteroffer.

That process continues, until both parties (adjuster and claimant) settle on a specific figure. At that point, the insurance company should prepare to send the agreed upon amount of money to the victim/claimant, or to the claimant’s lawyer. The lawyer pays anyone that has a lien, takes his or her fee, and then sends the balance of the money to the waiting client.