Car accident claims can quickly become complicated and legal guidance is the best course of action for victims who want to set up a claim’s settlement. An attorney can explain the process to you in simple terms and help you receive the compensation you deserve. To get started on the car settlement process, you have to report the accident per state laws.

The 5 Core Steps in a Typical Car Settlement Process

Step 1: Reporting the Accident – At-Fault vs. No-Fault

Your state will have specific reporting requirements, but you’ll typically need to report car accidents to the state highway patrol, county, or police department. Some states also require a written report if someone was killed, seriously injured, or the accident caused property damage.

The majority of US states follow the at-fault system, which makes the person at fault for the accident pay for the damages. At-fault states allow victims to explore the following options.

  1. File a claim with their insurance company.
  2. File a third-party claim with the defendant’s (or at-fault driver’s) insurance company.
  3. File a personal injury or car accident claim lawsuit against the driver.

If a car accident victim chooses the 3rd option, a hired lawyer will inform them on what to expect from a car accident settlement and guide them through court proceedings. In no-fault states, neither party can sue as the insurance provider will pay for damages covered by their policy.

Step 2: Filling the Personal Injury Claim

In at-fault states, the driver who isn’t at-fault can sue for economic damages, including medical expenses, lost wages, disability benefits, and more. The accuser can also sue for non-economic damages, like pain and suffering, loss of life enjoyment, and mental anguish.

File your personal injury claim within 2 years from the date of the accident, as most states have a statute of limitations that lasts about that long. In a personal injury case, the defendant’s insurance company pays for the damages, even if you sue the defendant directly.

Step 3: Investigating the Accident

At this point, you should hire a lawyer to represent you as the at-fault insurance company can become nasty, pushy, or potentially violate your rights. Their insurance won’t want to pay out a lot of money, so they may ask you to give a statement or ask questions that could disrupt the case. Refer the insurance company to your lawyer and for evidence building and report filing.


Be sure to gather documents, pictures, and copies of the following evidence:

  • Medical reports of your injuries
  • A police report from the accident
  • Photographs of the scene of the accident
  • A spreadsheet of your expenses
  • Names of witnesses present for the accident.

Ensure that you don’t say or do anything on social media that could affect your case, like making light of the incident or performing physical acts you shouldn’t be able to do.

Step 4: Approval or Denial Process

After the insurance company investigates your claim, they can choose to deny or approve it. If the claim is denied, investigate why this happened. Sometimes, it’s because a mistake was made or their policy doesn’t cover the accident. If your claim is approved, the insurer will agree to pay your damages in a settlement, but that doesn’t guarantee fair compensation.

Step 5: Approval or Denial Process

Insurance companies often offer a low settlement, but you can negotiate for a fair settlement covering the cost of your economic fees. A personal injury lawyer will come in handy here, as they understand the legal process and can fight for total compensation. If you reach an agreement, the insurance company will typically give it to the lawyer, who then gives it to you.

What if an Insurance Company Won’t Budge?

The accuser can either accept the settlement despite inadequate compensation, request mediation to come to an agreement, or file a personal injury lawsuit.

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