Are Lawyers Fees Included In a Car Accident Settlement?

The average settlement for a car accident is comprised of several different damage awards. Within the lump sum given to an injured party, there might be amounts dedicated to repairing property damage or reimbursing for medical bills. What a settlement contains is entirely dependent on the negotiations between the parties.

The Short Answer: No

The simplest answer to whether lawyer’s fees are included in a car accident settlement is that no, they are not. Settlements are intended to make an injured party as whole as possible following an accident and the expenses and damages it caused the party to incur. Technically, an attorney is unnecessary to assist during settlement negotiations. As such, insurance companies do not want to include attorney’s fees in their compensation award.

If No, How Attorneys Are Paid

If the settlement award does not include an amount of money for attorney’s fees, the attorney will often take a portion of the award as his compensation. The percentage of money he will take if successful in negotiations is agreed to by the attorney and the client at the outset of the two working together. This percentage is usually included in the contract agreement and should not be changed prior to the settlement being agreed to or delivered.

This means that the amount of settlement given to an injured party would be reduced by the attorney assuming his fee. While the amount of hours for an attorney to prepare for a settlement is significantly less than for a trial, the percentage agreements will reduce the total amount of the award delivered to the injured party.

The Exception to the Rule: Maybe

However, as settlements are purely derived from negotiations and eventual agreement between the parties, it is entirely possible that the settlement award will be increased to compensate the injured party’s attorney. This, though, requires the injured party to request attorney’s fees to be included in the settlement prior to or during negotiations. Whether the request will be acceptable or honored is dependent on the amount of the request and the insurance company’s amenability.

If Yes, How Attorneys Are Paid

If a settlement amount includes a fee for attorneys, the amount of the award will be increased to pay for the estimated fees. For example, if the attorney and client agree that ten percent of any settlement will be given to the attorney for his time, the settlement will be increased by ten percent. Again, the exact value of that ten percent is dependent on the values agreed to by the parties.

Getting Legal Help

If you are involved in settlement negotiations for a car accident, seek legal assistance with your claim. Discuss with your attorney whether any settlement amount will include his fees and, if so, the percentage of money that amount will be and how it will be delivered.