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Personal Injury Negotiations 101

December 19, 2014 Personal Injury

The Oldest Tactic in the Book

One of the oldest tactics in personal injury negotiations is the defense attorney approaching the plaintiff as a friend and asking what the bottom line number would be for settling the case. The lawyer will promise the victim that he will negotiate with the insurance company, but he will not tell them the bottom line figure that the victim wants. However, you should not fall for this strategy, and you should never ever tell the defense attorney what your bottom line figure is.

Disadvantages of Revealing Your Bottom Line Number

Personal Injury Negotiations

Keep the final settlement amount secret from the defense.

If you go ahead and divulge your bottom line settlement number, the defense attorney will tell this figure to the insurance company. Now, if the insurance company is inclined to settle your case, they will offer you an amount lower than your bottom line figure. Therefore, when you reveal the least amount, you are likely to settle for; you are short-circuiting the whole negotiating process.

You would have also destroyed the opportunity of having any wriggle room in the negotiating process. Hence, by disclosing to the defense attorney, what your bottom line figure is, even if he is a good friend of yours, you run a real risk.

Suppose you have revealed to the attorney that your bottom line figure is $100,000, the insurance company will most probably come back with an offer of $60,000 to $70,000. You will be surprised at such an offer, because you have said your bottom line amount was a hundred thousand. Now your lawyer and you will have to take a strategic decision, whether or not to proceed with the case over an amount of $30,000 to $40,000. Since you have already divulged the bottom line figure that you are willing to accept, you are now stuck in-between.

The insurance company knowing your bottom line amount has come up with a very significant offer, which is very tempting because it is quite close to your asking amount. However, now, you are at a disadvantage, because you have already given away any ability to negotiate effectively. If you refuse the offer, you have no other choice but to go to trial. If you agree to the amount, you would have lost the ability to try to get more. This is a very precarious position.

What You should Do

The better alternative would be to tell the defense attorney during the course of negotiation, a number much above what your true bottom line number is. This way, if the insurance company comes back with what they believe is their top number; you now have some room to negotiate. This is the reason; you need to be very wary during the course of negotiations, when the defense attorney or even the judge during a settlement conference asks you about your bottom line number.

You need to understand if the person asking the question is going to take the number, back to the insurance company with a motive to short change you. It is a very fine line in deciding whom you can tell and whom you cannot tell.