Thursday, October 11, 2012

What happens after a personal injury case concludes?

The conclusion of a personal injury case should be a satisfying, and an empowering time in a person’s life.  When a personal injury case concludes in the right way, and in a way that makes a person feel like they got what they were entitled to get, that they were heard, and that their life, and their injuries were taken seriously, there is no better feeling for them, or for their personal injury attorney.  It is a mixture of incredible accomplishment, and total relief.  In fact, for most personal injury attorneys, the entire focus of their careers is to learn how to accomplish great things for their clients. 

What many people do not know that have not been through a personal injury case (which is a good thing, of course) is what happens to the settlement funds at the conclusion of the case.  The answer is, a wide range of things can happen to the settlement funds, and a good, experienced personal injury attorney can really make a difference in making sure that you keep the maximum portion of your settlement.  Here is how it works, generally: first, legal fees are paid, then case expenses, then so called payback claims.  The remainder goes to you!

Let's take an example, consider a settlement of $50,000.00 for a person that was injured in a car accident, and that was represented by a personal injury attorney.  In this case, the first payment from the $50,000.00 settlement is to the injured person's attorney for 1/3 of the $50,000.00, or $16,666.67, leaving a remainder of $33,333.33.  What happens next? The attorney's expenses are paid.  Expenses refer to the attorney's costs, which vary depending on the case, but almost always include the cost of the paper used on the case, and the purchasing of medical records.  Some cases have low costs, but others have larger costs.  An example of a larger cost would be hiring an expert, such as a medical doctor, or an accident reconstructionist.  In our example, if the costs were $500.00, then the remaining funds would be $32,833.33.  Once the case expenses are paid, then, you must consider payback claims.  Payback claims are a separate, very interesting topic, but for now, consider the common situation of having to payback some part of the payments made by your insurance company for your medical treatment prior to settling your case.  (I will discuss payback claims in another, separate entry.  Sometimes, payback claims may be reduced to $0!) So, if your insurance company paid $10,000.00 for your medical treatment, it might be entitled to approximately $6,666.67 in payback.  Assuming no other payback claims, this would leave you with a net cash payout of $26,166.66.


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