“Last night I re-read an article you wrote in November of 2009 about attorney fees charged in personal injury cases. You interviewed law professors who were critical of 25 to 50 percent fees, which often translate into thousands of dollars an hour for making a few phone calls and hardly any time at all spent on the case.”

“Lawyers argue they are investing their time to represent a client with no guarantee of being paid. For this risk, the reward is a percentage of the recovery. In death or serious injury cases, this can work out to thousands of dollars an hour.”

“So being paid is contingent on the lawyer negotiating a settlement or winning in court. However, lawyers only accept a case when a recovery is virtually certain; therefore, the fee isn’t truly contingent.”

“David, my brother-in-law, was killed in a single-vehicle, rollover auto accident. He and a friend from work were returning from a fishing trip to the Morro Bay area. The friend was driving.”

“Their car failed to negotiate a curve, rolled several times, and both men died at the scene. The CHP found driver error.”

“David was married to my sister, Sarah, and they have two children. He was only 35 and was a pharmacist. The driver’s wife has told us the policy limit is $500,000.”

“Sarah has spoken to several lawyers, all of whom expect to be paid from one third to 40 percent. Is there a way of having a lawyer involved without losing well over $100,000 in attorney fees?

Unconscionable to charge a contingent fee

I ran the facts of this case by a colleague who has represented insurance companies for more than 20 years. He asked that I not use his real name, so I’ll call him Jeff.

“If that $500,000 auto liability is the only significant asset the driver had, there is absolutely no reason, and no need to hire a lawyer on a contingency basis. It would be tragic to lose well over $125,000, and possibly more,” he said.

“I can tell you horror stories about cases where insurance companies have offered to pay the policy limit, but someone frightened the family into hiring a lawyer. Not one more cent was obtained, yet the lawyer took a full one-third fee. This is unconscionable, and it happens all the time.”

Less complicated than you would think

“Resolving a death claim is far less complicated than most people would think. In reality, you will be doing what an attorney would do, only saving yourself thousands of dollars, and the suggestions I’m offering also apply to a wide variety of cases.”

“Contact the claims person handling the file, and ask what information they need to evaluate liability and damages. They will need a police report, marriage certificates, death certificate, photos showing that the family was all together and happy, and that there was no divorce pending at the time.”

“If there are children, then certified copies of their birth certificates should be obtained and everything sent to the claims person.”

“After a reasonable period of time – say, two weeks – contact the claims adjuster again and ask if they are going to pay the policy limit. If you do not know that limit, ask the adjuster to obtain permission to reveal it. However, do not stop with the insurance policy. In a case such as Sarah’s, she needs to find out if there is other property the driver owned which has significant value,” He stressed.

“For a very reasonable charge, a private investigator can find this out. But if you know they only have minimal assets, then make a settlement demand for the policy limit.”

Hire a lawyer on an hourly basis

“What happens if, for some odd reason, the family refuses to reveal the policy limit?” I asked.

“Playing hide the ball will get them sued. In that kind of a situation, you will need to hire an attorney on an hourly basis to file a lawsuit, have it served, and then send out what are called interrogatories. These are written questions, requiring a response and proof of the policy limit. The insurance company must reveal that policy amount if presented with interrogatories.”

Cost?

“The initial conference will take an hour, another hour to prepare the lawsuit, an hour for the interrogatories. Under five billable hours at that stage. These are usually all on forms, and a click of a computer mouse finishes the job.”

Next Week: Protecting the children and getting the insurance company to do the legal work for you at no cost.

Dennis Beaver practices law in Bakersfield and enjoys hearing from his readers. Contact Dennis Beaver.

The post Not all injury claims require hiring a lawyer appeared first on Dennis Beaver.

Last week, we told you about a reader whose brother-in-law was killed in a roll-over auto accident caused by a friend from work who apparently fell asleep at the wheel. There is $500,000 of insurance available to pay the widow, (Sarah) yet, she is interviewing lawyers who want to handle the case on a percentage basis.

My reader believes there is neither need nor justification to give a lawyer up to one half of that $500,000. He’s absolutely correct!

There is a way to obtain expert legal help and save thousands of dollars. In many cases it is even possible to get the insurance company for the responsible party to provide and pay for an attorney.

Sacred cow to lawyers – attorney fees

And, according to “Jeff,” a colleague of mine with more than 20 years of experience in insurance defense, my reader is “absolutely right in thinking that Sarah can get through this without losing up to $200,000 to an attorney who would spend very little time on the case.”

“The sacred cow among most lawyers is attorney fees,” Jeff commented.

“One of our dirty little secrets, is how some personal injury attorneys can be so incredibly overpaid for their value to society, for what they bring to their clients; more accurately stated, what they take from their clients. In most cases of serious injury or death, where fault is clear, hiring a lawyer on a contingent fee, is rarely necessary. There is a better way,” he argues.

Work with the insurance adjuster

In cases of serious injury or death, you need to learn the limits of available insurance. If, for some odd reason, the other side will not reveal that information, it is still easily obtainable, but will require hiring an attorney but not on a percentage basis! Through filing of a lawsuit and what we call “discovery,” that information can be promptly learned.

“For less than five hours of billable time, the policy limit can be obtained. Then, the attorney can work out the settlement specifics with the insurance adjuster. When they are willing to pay out most or the entire policy, it is a simple matter of deciding how much money goes to mom, and how much is dedicated for the children,” he points out.

“We are still in the billable hour area, and there is no reason at all to give up from 25 percent to 50 percent of the case value to a lawyer,” Jeff firmly maintains.

“The insurance adjuster can have their own attorneys work with family members on the specifics of a settlement, including obtaining court approval where children are involved.”

Who gets what?

“Courts want to be sure that children are protected. With our $500,000 policy limits, if mom wants two-thirds, most courts would approve that. She lost the breadwinner and is now responsible for the family,” Jeff reasons.

Where there are children, the funds should be in what we call a structured settlement. This is an insurance annuity, purchased from a highly rated life company. There are numbers of structured settlement companies throughout the country who work with individuals, private attorneys and insurance company lawyers.

With a very young child, $200,000 placed into a structure will allow for payments to cover college, professional school and across a lifetime. These are powerful financial devices, and can literally pay out several times the amount of the money placed into them.

You can provide for a certain amount during college years, and then every five years thereafter, or however you want to set it up.

Other sources of money

One easily overlooked source of additional funds in policy limit payment cases would be the Underinsured portion of the victim’s own auto insurance policy.

Here is how it works: You settle your auto accident case for the policy limits of the party at fault, we’ll say, $100,000. But your own auto insurance has an uninsured/underinsured limit of $150,000. You may make a claim against your own insurance for the difference between what the other side paid you. If your injuries are significant, that difference should be paid.

It is less confusing than it sounds.

Guidance from an attorney

“In your reader’s situation, he should consider retaining an experienced personal injury lawyer for his sister at that lawyer’s usual hourly rate, just to be sure that everything is being handled correctly. There is no reason on God’s green earth to literally make some lawyer wealthy at this family’s expense,” Jeff concluded.

Those were terrific words to hear … from a lawyer!

Dennis Beaver practices law in Bakersfield and enjoys hearing from his readers. Contact Dennis Beaver.

The post Saving huge attorney fees on personal injury claims appeared first on Dennis Beaver.