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Should I take the first insurance settlement offer after a crash?

On Behalf of | Sep 2, 2021 | Motor Vehicle Accidents |

Every driver has to carry car insurance in case they cause a crash. Insurance policies protect against liability, which means the driver who caused your crash in New Mexico will be the one whose insurance pays for your losses.

The state requires at least $10,000 in property damage coverage and $25,000 in bodily injury coverage when one person gets hurt and $50,000 of coverage for crashes that injure multiple people. Of course, many drivers in New Mexico do secure a higher amount of coverage to better protect themselves.

When you hear from the other driver’s insurance company with a settlement offer, you might quickly accept it because you have bills to pay from the hospital or the repair shop. Unfortunately, you might have accepted less compensation than you deserve. How can you make sure it’s a good decision to accept the settlement offer?

Really review the costs of the crash

How much compensation you receive depends on two factors. The first is how much coverage the other driver carries, and the second is the actual, provable losses you suffered because of the collision. You won’t receive an offer that exceeds the other driver’s coverage, but you can receive the full amount of coverage in some cases.

To make sure that the settlement offer is fair, you first need to review the financial impact you have suffered. For example, the damage to your vehicle doesn’t just result in repair costs. It can also diminish the value of your vehicle when you trade it in later or sell it as a used vehicle. You might want to counter the offer to simply pay your repair bills with a higher amount that includes the diminished value of your vehicle.

The same could be true of a medical settlement. An offer that only pays your current medical bills might leave you with tens of thousands of dollars of expenses in the future. You need to think about future care and the impact on your job as well.

When you accept a settlement, that’s all you’ll ever receive

If you agree to the settlement or cash a check, the insurance company will essentially no longer have any kind of financial obligation to you because of the crash. They could try to pressure you into accepting too little compensation, possibly by getting you to implicate yourself in a recorded statement.

The right help can make negotiating with the insurance company or handling their tactics a little easier. Learning more about how insurance works the New Mexico and the terms of lump sum settlement could help you avoid making a major mistake after a car crash.