If you suffer an injury or damage because of someone else, you might immediately consider filing a lawsuit. After all, this is what they do in the movies, right? People get hurt and shout, ‘I’m going to sue!’
In reality, things work differently. If, for instance, you are hurt in a car accident caused by a speeding driver, you do not automatically file a lawsuit. Instead, you file a claim with the driver’s insurance company.
If the claim is unsuccessful, you can consider filing a lawsuit. Do all claims result in lawsuits? The short answer is no, but it is important to understand when a lawsuit is relevant.
Also, it is crucial to remember that a claim and a lawsuit are not the same thing. Both have different requirements and follow different processes.
What Does It Mean to File a Legal Claim?
A claim means formally requesting compensation from an insurance company. It can also mean requesting compensation directly from the at-fault party.
Claims are common after car accidents, workplace injuries, and medical malpractice incidents. The reason you would file a claim first is to notify the at-fault party and their insurer of your intent to seek compensation.
Types of Legal Claims
Different types of legal claims apply in different situations.
- Auto insurance claims. If you are hurt in a car accident, you can file a claim against the negligent driver’s insurance company. Your claim would be for compensation to cover medical bills, property damage, and other losses.
- Homeowner’s insurance claims. You need homeowner’s insurance if you live in an area prone to wildfires or hurricanes. If your house is damaged during a fire or storm, you will file a compensation claim against your insurance policy.
- Personal injury claims. If you are severely hurt in a car accident, you can file a personal injury claim against the driver’s insurer. This will allow you to pursue compensation for economic and non-economic damages.
- Worker’s compensation claims. If you are injured at work due to your employer’s negligence, you can file a worker’s compensation claim to cover medical expenses and lost wages.
Again, filing a claim does not mean you are filing a lawsuit. It means you are taking the first step to securing compensation for your losses and damages. Claims are handled outside of court between lawyers and insurance companies.
What Is a Lawsuit?
Filing a lawsuit means pursuing formal legal action in court. You would typically file a lawsuit if your initial claim cannot be resolved. The at-fault party may deny liability, or their insurer may refuse to pay your claim.
If this happens, your lawyer will likely suggest you file a lawsuit. When a lawsuit is filed, you will have to attend legal proceedings. Your lawyer will present all the necessary evidence to prove your case. There may also be a trial.
It is important to keep in mind that lawsuits are expensive and time-consuming. This is why most legal claims are settled before they result in a court case.
Why Don’t All Claims Turn Into Lawsuits?
Most legal claims, especially personal injury claims, are settled outside court. This is because insurance companies prefer to settle disputes quickly. Settling a claim without going to court saves time and money for all parties involved.
If your case goes to court, it will cost you and the defendant extra money. You will both have to pay your lawyers and court costs. If you need expert witnesses, you must fork out even more money.
Not to mention, lawsuits can take a very long time to resolve. Some lawsuits can drag on for years, costing money the whole time. In contrast, claims can be settled within weeks or months. Most people prefer to avoid the drawn-out court process by requesting and accepting a reasonable settlement.
Moreover, strong evidence negates the need for a court case. If an insurance company gets clear evidence that the defendant was at fault, they will be more likely to settle a claim quickly. If you want to settle your claim fast, you need a police report, medical records, and photo or video footage as evidence.
Lastly, there are other ways to resolve disputes that arise during the claims process without going to court. Your lawyer may suggest mediation or arbitration before filing a formal lawsuit.
When Do Claims Result in Lawsuits?
Unfortunately, some claims will result in a lawsuit. For instance, if the at-fault party’s insurer repeatedly refuses to pay, your lawyer may file a lawsuit to motivate them to offer a settlement.
If the insurer keeps offering a lowball figure, your lawyer may also decide to file a court case. If all negotiations fail, you can decide to take legal action.
Furthermore, if there is a dispute over fault, it will be difficult for both parties to agree to a settlement. Cases like this may proceed to court.
It is also possible that when settlement negotiations drag on too long, you will reach the end of the statute of limitations for your case. If this happens, you may need to file a lawsuit to preserve your right to seek compensation.
How Your Lawyer Can Help You
You should hire a lawyer to help you file a legal claim after an injury. Your lawyer will help you report the incident and investigate every aspect of it. Moreover, your lawyer will assess your losses and damages and calculate your necessary compensation.
Your lawyer will negotiate with the relevant insurance company when the demand letter is sent. At this point, your case will either be resolved or proceed to court. If your claim does turn into a lawsuit, your lawyer will represent you in court and fight for the compensation you deserve.
Before this happens, however, your lawyer will work on avoiding a lawsuit. They will document all evidence to make your case as strong as possible. They will communicate with insurers and the at-fault party’s legal team.
Your lawyer will also advise you to stay patient during the process and not accept the first offer you get. There are a lot of strategies at play during the claims process, and being patient will ensure you get the best outcome.
By taking the right steps at the right time, you can avoid a lawsuit and settle your claim as soon as possible with the help of your lawyer.
