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April-18-2023

How to Counter-Offer an Insurance Settlement – Negotiation Tips

Negotiating an insurance settlement may seem intimidating, but you can increase your chances of success with the right legal advice and strategies. Knowing how to counter-offer an insurance settlement is essential to getting the best deal possible. By understanding the principles of negotiation, gathering important information, and making a persuasive argument, you can make sure that you get the most out of your settlement.

First Off – Don’t Jump at the Initial Settlement Offer

If you’ve suffered a loss and you’re reaching out to an insurance company for help, the first offer you will receive from them is nearly certain to be deliberately lower than what you expected. This “lowball” settlement is offered by the insurance company for a variety of reasons, including as an opener to negotiations and to test to see if you have the skills and the patience to negotiate.

Be wary, and rather than respond to the offer with a counter, you should instead ask the insurance adjuster to provide you with a further explanation.

Once you are better armed with additional information, your next move should be to write a formal letter to the insurance company stating that you don’t find the initial low settlement and its rationale acceptable, listing supports for your position, and then countering with a higher settlement offer.

How Do You Know a Settlement Offer Is Too Low?

There are some red flags to watch for when receiving settlement offers from insurance companies. Many home insurance claim adjuster secret tactics may be used to try to get you to accept a lowball settlement offer. These include making an offer quickly, pressuring you to accept (often while you’re under stress), questioning your damages, making you question yourself and your claim, refusing to answer questions, and ignoring evidence, sometimes obvious evidence, sometimes with even surgical precision. 

Insurance Settlement Negotiation Tips

Although the best course of action is always to work with a qualified attorney, such as the lawyers at MMA Law Firm, to help you deal with your insurance company, we also have curated some best practices tips for how to counter-offer an insurance settlement. We use these practices, and you should, too. When negotiating a settlement offer with an insurance company: 

Know Your Claim Value

It’s important to know the rough estimate of your claim’s value as you negotiate with an insurance company. You can get this information by speaking with an insurance claims attorney, as well as receiving estimates from contractors and other entities involved with repair and replacement. For destroyed personal property, look to the fair market value and/or the purchase price of the items in question.

Get Everything in Writing

At any stage of the residential or commercial insurance claims process, it is important to communicate in writing. This both keeps the negotiations professional and creates a reference library or a record if things change against your favor later in negotiations. The ‘get that in writing rule’ should encompass everything – including adjuster estimates, offers, counter-offers, and acceptance or rejection of the settlement.

Never Admit Fault or Speculate

When speaking to an insurance adjuster or other representative of the insurance company, it is critical to never admit fault for the damage you have suffered. It’s also a best practice to avoid providing anything but the facts and keep additional information, opinions, and speculation out of the conversation. Why such a tight gag order on what you can say? By design, the insurance company is looking for ways to pay less on your claim. Every statement made can be and will be used to achieve this, so it’s important to speak very deliberately and carefully with insurance company representatives. 

Don’t Let Things Get Personal

At a time of great loss and upset, things can get personal, and hearing your losses be undervalued by an insurance company can be frustrating – if not infuriating. But take a step back and calm down. Remember that while you may feel emotional, insurance companies handle endless claims like yours every day as a business. If helpful, refer to the writing rule above. The written word in a letter or email can always be edited, and it is difficult to take back what has been said in the heat of the moment.

Work with an Experienced Lawyer to Get a Better Offer

Keep in mind that determining the true value of your case is extremely complicated, and much of it is likely to be based on applicable statutes, rules, regulations, contracts, policies, and industry practices. These are all squarely within the realm of attorney practice. So, when asking the question “how to counter-offer an insurance settlement,” the answer becomes simple: don’t hesitate to reach out to speak to an insurance lawyer in Houston who is willing to help you with your claim.

Seek Professional Legal Counsel from MMA

As professionals who help clients interpret insurance policies, understand their rights, and recover on their losses every day, the attorneys at MMA Law Firm are qualified to help clients negotiate with their insurance companies. Contact us today so that we can help you.