The Settlement Demand
A settlement demand is a formal communication — often in the form of a demand letter — requesting that the at-fault party's insurance company pay a specified sum to resolve the personal injury claim. It typically includes documentation of liability, injuries, medical treatment, and damages.
When the Demand Is Sent
Attorneys typically send the demand after: the client has reached or is near Maximum Medical Improvement, all medical records and bills have been gathered, lost wages and other economic damages have been documented, and any liens have been identified. Sending a demand prematurely — before the full picture of damages is known — can result in settling for too little.
What the Demand Includes
- Description of the accident and liability
- Summary of all injuries and treatment
- Economic damages with documentation
- Non-economic damages narrative
- Total demand amount
- Supporting documents as exhibits
The Negotiation Process
The insurer's response is typically a counter-offer lower than the demand. This begins a negotiation process. The initial demand includes room to negotiate — experienced attorneys set demands at a level that allows for reduction while still achieving a fair result. If negotiation fails, litigation may follow.
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