How Do Car Insurance Companies Determine Settlements After An Accident?


Insurance companies take into account a variety of factors to determine settlements after an accident. Chief among these factors are:


What is the nature of the property damage?
Was there a personal injury involved?
What are the insurance policy limits?


Typically, most accidents involve damages to a person’s vehicle, such that their insurance settlement pays for the cost of repairs and/or replacement of the damaged part(s). If and when the damage to a vehicle is so bad that the repair/replacement cost is more than the value of the car, then the insurance company is likely to call it a “total loss,” and just pay the person for the loss of the vehicle.


When there are personal injuries involved, an insurance company will consider a person’s medical bills, their documented wage loss (since they couldn’t work), and the severity of the injuries according to medical reports, which come into play with regards to “pain and suffering.”


Finally, policy limits matter because they contractually outline how much, ultimately, an insurance company is willing to pay. If a person has a policy limit of $30,000 but the damages are $40,000, the insurance company is only obligated to cover $30,000.


Sometimes people will file lawsuits against one another because they want more money. People can get quite contentious when it comes to figuring out who is at fault for a car accident! Personal injury lawyers help these people battle it out from a legal standpoint, and may employ the use of 4N6XPRT’s data-rich accident reconstruction software to help make their case.