5 Ways to Skilfully Negotiate your Auto Insurance Settlement

We all want to avoid auto accidents. A car crash is a stressful and potentially dangerous experience, and can cause irreparable damage to people and property. Unfortunately, no matter how much we try to steer clear of crashes, they happen with shocking frequency — in just one year, an average of 6 million car accidents occur in the US. Your risk of being in a crash goes up even more if you are racking up a lot of miles.

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If you are involved in one of those 6 million crashes, it can push you to your physical and emotional limits, leaving you overwhelmed. It’s in that state that you are called on to file an accident claim with your auto insurance company.

When you feel stressed and shaken up, you can make rash choices. However, at a recent contract negotiation training in NYC that covered the cornerstones of negotiation skills, the trainer specifically broached negotiation in high-pressure situations. She assured the negotiation class attendees that a person who is well-versed in the essentials of negotiation will be able to access those skills in any situation, even under stress.

That’s why we are sharing five ways you can bring the most important tenets of negotiation trainings into your auto insurance settlement negotiations.

Don’t admit fault

Negotiations trainings will often tell you that there are few subjects that are non-negotiable. However, if you have been in an auto accident, you cannot admit fault. Doing so is the equivalent of giving up on the negotiation before it has even begun.

If you admit fault and the other party involved in the accident does not, then you will be held liable for the entire incident and may receive no insurance payment. This applies to your interactions with the insurance adjuster and with the other party, including right after the accident happens.

To stay safe, you will have to guard against your politer instincts. Many of us have learned to immediately apologize when something has gone wrong. However, an innocent “I’m sorry,” may keep you from getting payment from an insurance company, whether or not the accident was your fault. An apology is seen as an admission of fault, so train yourself to remain kind without damaging your negotiating position.

Keep your receipts and do some calculations

Negotiation trainings remind us that we need to think creatively about our goals. So, when you consider your expectations for your auto insurance settlement, think expansively about the effects that the accident has had on you, and what that means for you monetarily.

Take immediate effects into account…

There are the obvious damages to your car, which you can have estimated by an auto repair professional. However, there may also be farther-reaching consequences.

If you or someone else was injured in the accident, you should take the resulting medical bills into account in your calculations. Having had such an emotionally-intense experience, you may have sought out support from a trained mental health professional to deal with the trauma. When doing your calculations for your initial ask, include all the costs you have paid out of pocket related to the accident.

…As well as long-term impacts

Likewise, if your injury was serious enough, it might have effects on your future earning potential. Your cost calculations should therefore include not only out-of pocket expenses, but also estimates of how the accident will affect you in the future.

Document it all

To back up your claims, it’s important to have documentation. Be sure to keep receipts from your expenditures and get written estimates of how the accident will affect you in the future. Having this information on hand will help you write a persuasive, well-documented demand letter, giving you a stronger opening position in your negotiations.

Go in prepared

Before you go to make any deal with your insurance company, make sure you are well prepared for your settlement negotiation. Read through the information in your insurance contract. Though you may already have read the fine print when you signed up (most of us don’t), it will help to have the relevant information fresh.

With this information in hand, you know exactly what’s covered. If you went for a plan that minimized liability coverage, you may have less bargaining power. However, if you went for the plan that gave you fuller coverage (and therefore have been paying higher premiums), you will have more leverage. Understanding your insurance contract’s coverage will allow you to tailor your ask to something that the insurance company can reasonably authorize.

Remember that you are your own best advocate

A foundational negotiations workshop will remind you that each party is looking out for their own best interests. An auto insurance company has an interest in paying out as little as possible. Remember that you alone will be advocating for your own interests. Make sure you are well-prepared to do so.

Ask for what you need from the insurance company

Negotiations courses emphasize the importance of being in a good emotional state when you enter a negotiation. If you are flustered, unprepared, or angry, you may rush the process along, so you can just be done with it. This can lead to a shoddy deal for you!

Before entering into any interaction with your insurance company, make sure you feel calm and collected. If you don’t feel comfortable, feel free to make requests that will ultimately help protect your interests. If you recognize that you are feeling tense when your insurance company calls, ask them to call back later. And if you don’t feel comfortable with the insurance adjuster assigned to your case, request a change. Though it may feel uncomfortable to make these requests, they will help safeguard your interests.

Call on outside support

You should also call on friends, family, or even a professional for support in processing the high-stress situation you are going through. That way, you won’t be dealing with your emotions for the first time in the middle of a complex negotiation process.

Know what would make you happy and respect that

As mentioned, an auto insurance adjuster is going to look to protect their company’s interests by limiting the payment they make to their clients.

The adjuster has likely been to a few negotiations workshops in their day. Since their goal is to negotiate a low payment to the customer, they will know not to open with the highest amount they are authorized to pay out. Instead, they are going to start with a low offer. Don’t just accept the opening bid.

At this point in time, you will have read your insurance contract and know what is covered. You will have documented the costs of the accident to you. You will have ensured your own emotional well-being and preparedness. You will be bringing in the best tips from negotiations trainings to be ready for this moment.

With this grounding, you can be flexible in what you are willing to accept, but will also know the lowest offer you would take. You will be ready to stand up for yourself to get the company to respect that bottom line.

If you go in with clear standards about what you will accept, and the preparation to back that up, you are sure to negotiate a deal that is in your best interest.

Author: Lilou Hoffman