When you file a personal injury claim in Kentucky, one of the first major decisions you'll face is whether to accept the initial settlement offer from the insurance company. While it may be tempting to take the first offer—especially if you are facing mounting medical bills and lost wages—doing so could mean settling for far less than you deserve. Insurance companies rarely present a fair offer upfront, and there are several reasons why their initial proposal is often lower than what you might ultimately receive with proper negotiation or legal representation.
Below are five reasons why your first settlement offer in a Kentucky personal injury case is likely to be lower than expected.
1. Insurance Companies Prioritize Profit Over Fair Compensation
Insurance companies are businesses, and like any other business, their goal is to maximize profits. The less they pay out in claims, the more they retain for their bottom line. Adjusters are trained to protect the company's financial interests, which means offering settlements that are lower than what claimants may be entitled to under the law.
They often start negotiations with a lowball offer to see if the claimant is willing to accept without questioning its fairness. Many accident victims, especially those without legal representation, accept the first offer because they assume it is the best they will receive. However, in most cases, this initial figure is just a starting point for negotiations.
2. Your Injuries May Not Be Fully Accounted For
The initial settlement offer often comes before the full extent of your injuries and future medical expenses are known. If you've recently been injured, you may not yet understand the long-term impact on your health, employment, and overall well-being.
For example, if you suffered a back injury in a car accident, the insurance company might offer a quick settlement that only covers immediate medical costs. However, back injuries can lead to chronic pain, the need for future surgeries, and lost earning capacity over time. Once you accept a settlement, you typically give up the right to seek additional compensation, even if future medical costs arise.
According to the National Safety Council (NSC), the average cost of medical treatment for a disabling injury following a car accident can exceed $155,000. Yet, many initial settlement offers only cover a fraction of these expenses.
3. They Assume You Are Under Financial Pressure
Insurance adjusters are aware that many injury victims face significant financial hardships due to medical bills, lost wages, and other expenses. They use this knowledge to their advantage, offering a low settlement in the hopes that you'll accept quickly out of desperation.
This tactic is particularly effective in Kentucky, where nearly 63% of Americans live paycheck to paycheck, according to a recent survey by LendingClub. If you are struggling to pay your bills, you may feel pressured to take the first offer rather than waiting for a fairer settlement. However, working with a personal injury attorney can help level the playing field by ensuring you receive adequate compensation for both present and future losses.
4. The Insurance Company is Testing Your Willingness to Negotiate
Most initial settlement offers are not final. Instead, they serve as a starting point for negotiations. Insurance adjusters expect claimants to counter their initial offers, but they also know that many people—especially those without legal representation—will simply accept what is presented to them.
Negotiation is a key part of the claims process, and statistics show that individuals who hire a lawyer often receive higher settlements than those who handle claims on their own. A report from the Insurance Research Council (IRC) found that those injured and hired a lawyer achieved settlements that were 3.5 times higher than those who did not.
If you receive an offer that seems low, it's important to push back. A skilled personal injury lawyer can present evidence to justify a higher payout, including medical records, expert opinions, and accident reconstruction reports.
5. They May Dispute Liability or Downplay Your Damages
Another common reason for low initial settlement offers is that the insurance company may dispute liability or argue that your injuries are not as severe as you claim. In Kentucky, which follows a pure comparative negligence system, your compensation can be reduced if you are found partially at fault for the accident.
For example, if you were in a car accident and the insurance company argued that you were 20% at fault, your settlement amount could be reduced accordingly. Insurers often use this system to minimize payouts by shifting blame onto the injured party.
Additionally, they may try to downplay the severity of your injuries by claiming that:
- You had pre-existing conditions that contributed to your pain
- Your injuries do not require ongoing treatment
- Your medical expenses are excessive or unnecessary
This is why it's critical to have strong documentation, including medical records and expert testimony, to support your claim.
What Should You Do If You Receive a Low Settlement Offer?
If the insurance company presents a low initial offer, consider taking the following steps:
- Do Not Accept Right Away – A quick settlement may not fully cover your losses. Take time to evaluate the offer.
- Consult an Attorney – A personal injury lawyer can help decide whether the offer is fair and negotiate for a better payout.
- Gather More Evidence – Medical records, witness statements, and expert testimony can strengthen your case.
- Respond With a Counteroffer – Negotiation is expected, and most initial offers leave room for improvement.
- Be Prepared to Go to Court – While most cases settle out of court, showing that you are willing to pursue litigation will put immense pressure on the insurer to offer you a fair settlement.
Conclusion
The first settlement offer in a Kentucky personal injury case is often lower than what you may rightfully deserve. Insurance companies use tactics such as lowballing claims, questioning liability, and capitalizing on financial distress to minimize payouts. However, understanding these strategies and working with a personal injury attorney is going to help you secure the compensation necessary for your recovery.
Need Legal Help? Brandon J. Broderick, Attorney at Law is One Phone Call Away
Navigating Kentucky Personal Injury Claims can be challenging. Fortunately, you don't need to do it alone. The experienced lawyers at Brandon J. Broderick, Attorney at Law, are available 24/7 to help you understand your legal options, gather necessary evidence, and build a strong case to secure the settlement you deserve.
Contact us now for a free legal review.