Does an Accepted Settlement End Lawsuit Negotiations?

Knowing whether or not to accept a settlement offer can be a difficult task. On the one hand, you may need the money that’s being promised sooner rather than later. On the other hand, you could potentially negotiate for maximum compensation. With that in mind, it’s natural to ask whether you can reopen a lawsuit after a settlement. Or is it all over and done once the final settlement has been accepted?

Typically, no, you cannot reopen a lawsuit after agreeing to a settlement or accepting the financial recovery.

There are good reasons for this unfortunate situation, though. For example, suppose a car accident victim was to recover damages for their injuries. In that case, they shouldn’t be allowed to ask for property damage compensation later because their vehicle develops issues.

We understand that you probably need the money for medical expenses, lost wages, or other reasons. But you can’t accept a small amount initially and hope to argue for more later. You must attempt to find a level of patience previously unknown to you, let your lawyer negotiate on your behalf, and wait for the most acceptable offer possible.

What Do Insurance Companies Get in Return for Paying Damages?

The insurance company will pay your damages when you sign a settlement agreement. But they’ll get something from you in return, too.

The insurance company may ask that you keep the terms of the settlement agreement confidential. The reasons for this may vary, but one such reason is that some defendants do not want it being disclosed that they admitted wrongdoing and paid a settlement out of court.

The most important thing they will undoubtedly ask of you is that you sign a release. This will release the insurers of all further liability related to the claim.

What is the Importance of a Release Clause?

There is no settlement agreement without a release clause. One does not exist without the other. Most settlement agreements include language that refers to the settlement and a ‘release of all claims’ in the same sentence.

A release clause is the main thing preventing you from reopening the lawsuit. When you sign the settlement agreement and the release clause, you’re signing away your right to pursue damages for the case.

The release clause is the most important document for insurance companies. It’s their way of ensuring they’re off the hook for future damages. However, a release clause may include minor exceptions, which might allow you to escape the clause.

Exceptions may include:

  • Critical information about the severity of your injuries was withheld during original settlement negotiations.
  • The insurance company did not meet the terms of the agreement, either by negligence, an act of bad faith, or some other reason.
  • The release clause overreached, granting too much power to the insurance company. If discovered by a court, there could be additional damages.
  • The settlement language and legalese were vaguely written. This is unlikely, as insurance companies are careful to avoid making such a mistake.

Can You Reopen a Closed Claim?

While it is usually impossible to reopen a lawsuit once you’ve accepted a settlement offer, you may be able to reopen a closed or denied insurance claim.

A claim is closed when it goes inactive. This means the insurance company is not doing any further investigations and is not planning to pay you more damages. But just because the claim is closed does not mean that it was denied or that it is dead. It’s still possible to reopen a closed claim. In fact, sometimes, it may be a necessity. For example, if your Unemployment Insurance is closed because it’s been 30 days since you last received benefits, you’ll need to file to reopen your claim.

Should You Accept the Insurance Company’s Settlement Offer?

Be mindful not to accept the first offer the insurance company sends. This initial offer may look good, but it can always go higher, provide more, and do better for you and your loved ones. They know you cannot reopen your lawsuit after accepting the offer, so they may pressure you to accept the initial offer.

Insurance adjusters may even contact you before the settlement agreement is written. And though the insurance adjuster may seem sympathetic and kind, it’s important to remember that they’re not on your side. Anything you say to them could be used to reduce the damages for your settlement offer.

Remember: the insurance company may put on the mask of empathy, but they don’t care about your pain. They only care about saving money whenever and wherever possible.

If insurance adjusters come to talk to you, direct them to your personal injury attorneys instead. Then, work with the attorneys to negotiate better settlement terms. Because you know they can do better than their initial offering.

But, As Always the Case With Lawyers, It Depends!

If you have uninsured motorist coverage on your car, it is quite possible to settle with the person that hit you and continue to negotiate with your uninsured motorist carrier later. NOTE: If you don’t have uninsured motorist coverage, you need it. It’s the only car insurance that covers YOU. All other coverages cover the car or the other person.

Schedule a Free Case Review with Experienced Personal Injury Lawyers

If you or a loved one have suffered injuries in an accident caused by someone else’s negligent actions, you may be entitled to seek compensation via the legal claims process. However, when the settlement offer comes in, it’s crucial that you don’t jump at the first number they offer. You can’t reopen the lawsuit once you accept a settlement offer and ask for new terms.

Discuss your case with experienced personal injury attorneys. They can help you pursue compensation that meets your needs so that your medical bills, lost wages, property damage, and emotional distress are adequately handled.

Schedule a free consultation today by calling (225) 240-4053.