Personal Injury FAQs

Personal Injury FAQs

How Do Personal Injury Cases Work?

In order to recover compensation in a personal injury case, the first step usually involves contacting the at-fault party or their insurance company and making a claim for compensation. This step will begin a process of negotiation between you and the at-fault party or their representatives. You will also begin to negotiate over the amount of compensation you will receive.

If both sides can agree on a compensation amount, they will execute a settlement agreement of your personal injury claim. If the parties cannot reach a settlement, the injured party may have to file a lawsuit in court.

The litigation process involves a period of “discovery.” During that process, both sides exchange evidence and information. The claim will be heard in a trial before a jury or a judge. The judge or jury will reach a verdict that decides the case. The verdict may find that the injured party is entitled to compensation. If so, the court will render a judgment that sets out the amount of money the at-fault party must pay.

When Should You Contact a Personal Injury Lawyer?

You should contact a personal injury lawyer as soon as possible following your injury. Depending on the circumstances of your accident, you may be contacted by the insurance company or attorneys for the at-fault party. They may offer you quick compensation in exchange for settlement and release of your claim.

However, be aware that these offers are often far less than your total damages. A personal injury attorney can help you evaluate any settlement offers you receive. The attorney can negotiate with the at-fault party or their insurers or representatives. The goal is to get you a fair and full settlement of your damages.

An attorney can also investigate your claim to determine what and who caused your personal injury. This investigation could be crucial if the party you believe to be at fault for your injuries tries to deny liability.

How Are Personal Injury Settlements Paid Out?

Once you and the party responsible for your injuries (or the party’s insurance company) have agreed on the amount of compensation, you both will execute a settlement and release agreement. The compensation amount will often be held in escrow by a neutral third-party. The funds will be released once the settlement agreement is executed and legally binding.

In many personal injury cases, the settlement funds are paid to your attorney. If you have a contingency fee agreement with your attorney, he or she will deduct any fees and costs and then pay the remaining amount to you.

Is a Personal Injury Settlement Taxable?

As a general rule, the compensation received in a personal injury claim is not taxable. No taxes are owed as long as the money is for a personal injury or illness caused by someone’s negligent, reckless, or intentional acts.

However, any money you receive that is not strictly part of the personal injury settlement may be taxable. For example, some states impose tax on any interest that accrues on your personal injury award.

Any punitive damages that you are awarded are also taxable. In addition, compensation for emotional distress is fully taxable unless you can show that the emotional injury was accompanied by physical harm or distress.

Do I Need a Lawyer for a Property Damage Claim?

In many cases it is advisable to have an attorney for a property damage claim. You may not realize what property is part of your claim. A lawyer may seek compensation for you laptop computer or smartphone that was damaged or destroyed in the accident.

A dispute may arise over the amount of compensation you are entitled to for the property damage. For instance, the at-fault party may dispute the value of the car that was totaled in the accident. An attorney can negotiate on your behalf to maximize the amount of compensation you will receive.

Can You Change Personal Injury Lawyers?

Yes. Generally speaking, you have the right to choose which attorney will represent you in your personal injury case. If you become dissatisfied with the job your current personal injury attorney is doing — or change your mind about your attorney for any reason — you have the right to hire another lawyer.

However, the process of changing lawyers depends on the status of your personal injury case. If your case is already in court, you and your new attorney will need to file a substitution of counsel, which formally notifies the court and the other parties that you are replacing your attorney.

Under certain circumstances, the court may decline to allow you to switch lawyers. For instance, a judge may decline the switch if he or she believes you are simply trying to delay your case. The court may also decline the request if a conflict of interest would arise. For example, the judge may find that the attorney you want previously represented another party in the case.

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