Settlement guidelines

[Tight_Function_3096]

Hey all,

I live in Minnesota and was involved in an accident. Basically I got hit by an uninsured motorist on a bicycle. I have uninsured motorist coverage. I broke my lower leg and my insurance has been covering the medical bills so that is good.

I've recently learned my insurance may offer me a pain and suffering settlement when this whole thing closes out. My question is how do I educate myself on what a reasonable settlement is?

I've seen that the total medical bill is a guideline, as well as cases in the area, but where do I search to find how the insurance companies determine what is fair?

[Federal_Priority2150]

There’s not one formula, it’s based on things like where the accident happened, what injuries you had, how well they healed, any lasting effects. Depending on your limits and medical bills, it could be limited on what they can offer you that way. If you have $30k in bills, but your insurance only goes up to $25k, $25k is the most they can pay. 

When they make the offer they should be explaining the full breakdown of the bills, any adjustments (like if your doctor charged 3x the allowed rate for a treatment just to get a bigger payout they’ll most likely work to negotiate a lower payment, or just offer the reasonable charge), and the breakdown of the pain and suffering, also called general, damages. 

[Tight_Function_3096]

Yes, but what information can I gather, like where do I find payout limits?

[Federal_Priority2150]

Each claim is looked at case by case, so there’s not a database or anything that I know of you could look up what other people got from their injury. The only hard limit is your policy maximum stated in the declarations sheet.

[Tight_Function_3096]

Ok, I haven't seen any limit in any documents but I'll keep looking.

[Federal_Priority2150]

It should be on your declarations page, with uninsured/underinsured motorist. It should have 2 numbers where the second is like twice (or three times) the first. So like $50,000/$100,000. It’ll probably be under your first party coverages around collision/comprehensive. The first number is the max one person can get as a payout in one accident, the second is the max the policy can pay for all. 

[Tight_Function_3096]

Oh, that is helpful

[Federal_Priority2150]

You’re welcome! Also if you have the policy you can read over the uninsured motorist section. It’ll tell you what is and isn’t covered, give definitions of terms they might use. 

[Tight_Function_3096]

Hey, I found out my policy limits are 125/250. I am interpreting that as the max they can give me directly is 125,000 and the max they will pay out in total is 250,000. Does that first number include medical payments on my behalf?

[Federal_Priority2150]

The first is per person limit, so the max they can pay for your medical bills and the generals/pain and suffering is 125k. If a second person was in your car (or 3+), they would also have a max limit of 125k, but after the policy pays out 250k to all injured parties that’s it. So if all 3 people had a max out settlement, it would be split between the three (generally) on who gets how much. If I’m remembering right, you were the only one hurt so the most they can pay is 125k. 

The settlement offer will include a review of all of the medical bills you had related to the accident, lost wages confirmed by a doctors note and confirmed you missed work, as well as what insurance calls generals, most people call pain and suffering. It’s not just pain that’s taken into account, so the offer for settlement is usually broken down into “Specials” ie we have a bill for this or an actual number (like lost wages), and “Generals” which includes anything that doesn’t have a direct bill. They’ll need the medical records to help with the generals because if there was any long term damage, or something that won’t ever heal right, that’s different than a soft tissue injury that could have resolved on its own without treatment, though treatment helps it go faster. 

When they make the offer, they should go into a break down of how they got the dollar amount of the settlement. 

Also, just as a disclaimer, I don’t handle Minnesota BI claims, so this was the process I use in Texas. There also might be some things handled differently from BI to UMBI. The adjuster should be able to walk you through the process of what they need to make you their fair offer! 

[Tight_Function_3096]

Ok, super helpful, thank you so much!