Car Accident Settlement Process: How Does it Work? 

Car Accident Settlement Process: How Does it Work? 

If you are a victim of a car accident, then you will be entitled to some form of compensation for your financial losses and physical injuries.

In most cases, you’ll receive said compensation from an insurance company. While insurance companies operate by compensating people, they will try to pay you the bare minimum monetary compensation.

So in most cases, the victim must fight for their rightful compensation settlement. Fighting settlement claims against the trained professionals of insurance companies is a daunting task for most people. This article will discuss the car accident settlement process and how you can get your dues.

The Two Types of Settlement Systems

The settlement system varies based on your region or state. Based on that variation, you can expect one of these two settlement options— The at-fault system or the more unorthodox, No-Fault system.

● At-Fault Settlement: At-fault settlement system is the traditional insurance system. Most states in the US abide by this. In essence, an at-fault system means you’ll get your settlement from the driver who was at fault during the accident. If you were at fault, the other driver could do the same.

● No-Fault Settlement: Those fortunate enough to live in a state with a no-fault system can get economic compensation no matter who is at fault. There will be no going to court against the other driver, and the whole process usually happens quickly.

Unfortunately, Tennessee is not a No-Fault state, so the people of Knoxville will need to fight tooth and nail to get their due. Getting compensation from an opposing insurance company will always be tough, especially if you need medical recovery.

What Should You Do After The Accident?

Immediately after the accident, your first job is stabilizing your condition and getting yourself out of danger. If you are physically capable, your next moral duty would be to check on the health of the other victims of the accident. You should also call 911 at this point and make the case official.

If you are physically able, gather as much evidence as possible during the initial stages. Any fresh evidence is worth its weight in gold, and you will thank yourself later. Take photographs of all the damages to both vehicles and the surrounding area.

Talk to the people around the accident site and establish a connection. They will be valuable eyewitnesses to the whole thing. You should also take note of the establishments around the accident site and see if they have any CCTV installed. You can ask for the footage later.

People are generally unaware of what and how much evidence they need for a case like this. And it can be especially daunting when you are disoriented from an accident, so it is highly advised to seek professional help as soon as possible. You can always find assistance with a Knoxville car accident lawyer in such situations.

Assess The Damage

In At-fault states, you are very likely to get contacted by the at-fault party’s insurance company to take a lump sum settlement. If possible, you should avoid this interaction because they will try to under-compensate you in various ways.

Instead, you need to consult with professionals to assess your total losses. The doctor should be your priority since they can give you a detailed estimate of your treatment, post-treatment, and other related expenses. Contact your mechanic or civil engineer to assess the damage to your car and the subsequent repair fees. You could leave these jobs to your lawyer if you hired one.

File Insurance Claim

Once you have your numbers sorted out, you can proceed with the insurance claim. This step is quite straightforward if you have an attorney on your side.

#1 – Demand Letter

Your attorney can evaluate your immediate losses and expected losses. Medical and financial, lost income, psychological suffering, and other expenses are valid losses you can compensate for. Your attorney will send a demand letter citing those losses to the at-fault party’s insurance company. The insurance company will do its investigation at this stage to verify your claims.

#2 – Response

The investigation step can take longer for more serious accidents. But the insurance people will eventually reach out to the compensation claim. They will try to deny as many claims as possible, so their final offer will almost always be less than your claimed amount.

#3 – Negotiation

You can start the negotiation process if the offered compensation is too little. This is where a layer will help the most. Your lawyer can now negotiate with the insurance carrier to get a better settlement for your case.

#4 – Mediation

If your lawyer and the insurance company can not reach an agreement, they can go into a mediation phase. It’s where both parties meet with an impartial mediator to reach a more agreeable outcome. The mediator must be a neutral party that the insurance company and your attorney agree on.

Both sides will place their arguments and evidence before the mediator, and the mediator will try to give a more impartial solution. Do note that the mediation process is not a mandatory step. It is completely voluntary, and you can immediately move to a court case without bothering with this step.

Litigation Process

Sometimes, the attorney and the insurance carrier may fail to reach a satisfactory settlement. In this case, you can take this case to court. This will get the authority to step in, making the process more convoluted. One of the reasons why people try to avoid court cases is because it takes too long to reach a satisfactory conclusion.

During the court trial, your attorney will present all the evidence gathered so far. There will be an information exchange stage where both sides submit all their evidence. Injury victims benefit more from a court trial because it helps them get full compensation for their losses. 

You can even delay the court case if you haven’t recovered from your injuries. Depending on the circumstances, it could be weeks, months, or even years. But you must pay your medical bills out of pocket because your compensation will only arrive after the case ends.


In most at-fault states, insurance companies will try to deny your compensation claims as much as possible. The less they pay you, the more money they can save. 

So getting a trained professional on your side is always a better choice. If you need any related help, do contact a Knoxville car accident lawyer. They offer free consultations.

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