Rachel Bodine graduated from college with a BA in English. She has since worked as a Feature Writer in the insurance industry and gained a deep knowledge of state and countrywide insurance laws and rates. Her research and writing focus on helping readers understand their insurance coverage and how to find savings. Her expert advice on insurance has been featured on sites like PhotoEnforced, All...

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Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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Reviewed by Jeffrey Johnson
Insurance Lawyer Jeffrey Johnson

UPDATED: Apr 14, 2022

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Just the Basics

  • The insurance adjuster is a great resource when it comes to asking about your coverage or policy, but do not trust them to guide you to a fair settlement
  • If the adjuster considers your vehicle a total loss, it means your car will cost more to repair than it is worth, but you do not have to accept the lowest offer
  • Call local car dealerships to find similar vehicle comps in your city to negotiate a fair car insurance settlement

When it comes to learning how to negotiate a car insurance settlement, the best piece of advice is never to take the insurance adjuster’s first offer. While they may want to help, they are limited to the mechanics and valuation methods approved by the car insurance company. Those valuations do not always match up with similar comps in your city, and your insurance company may undervalue your car.

If your car insurance company is undervaluing your vehicle after an accident, this will reduce the claim you are eligible to receive. Unfortunately, this could also mean the company’s undervaluing your medical and pain and suffering claims.

Prepare your case after a car accident and counteroffer the adjuster’s initial low offer right away. This guide will give you the tools you need to determine what your vehicle is really worth and teach you the right way to negotiate a settlement for your car accident. 

How to Negotiate with a Car Insurance Adjuster

Use your car insurance adjuster to answer basic questions about your policy limits, what types of coverage you have, or what the insurance company pays. They are a great resource, but you should not trust your insurance adjuster for advice or guidance on how to settle your claim. 

Insurance adjusters work for the car insurance company and will work to save the insurer money, not you. The insurance adjuster may determine your vehicle to be a total loss and offer you an amount they think the vehicle is worth. And when it comes to injuries, insurance adjusters can argue that certain treatments are unnecessary or not covered by the policy. 

If you have suffered no injuries in a car accident, your settlement offer from the car insurance company will only apply to the costs to repair your vehicle. 

The adjuster may also determine that your low-impact accident claim is not entitled to an actual cash settlement for suffering damages. However, this is not always the case, so do not accept the first offer from the insurance adjuster. You have more options than what the insurance company may be telling you. And as the injured party, you have the right to counteroffer and provide evidence of your claim. 

Follow the steps below to prepare your counteroffer and negotiate a fair car insurance settlement.

Research Your State Fault Laws

Whether you live in a no-fault vs. tort state will determine which insurance company you negotiate with and how much you can claim. For example, some tort states prohibit customers from recovering damage settlements from their own insurers. 

When you are unable to file a claim with your car insurance company, you will have to negotiate with the other driver’s insurer. If you are arguing with insurance companies about at-fault drivers, consult with a car accident attorney before moving forward.

Some tort states operate under a comparative negligence model. This means your percentage of fault can reduce settlement amounts, and you may not be eligible for compensation if you were more than 50% at fault for an accident.

Other tort states are more strict when it comes to compensation. For example, in Virginia, Alabama, North Carolina, Maryland, and Washington, D.C., drivers must be found 0% negligent in an accident to qualify for a settlement from the other driver’s insurer. 

In no-fault states, drivers are responsible for their own damages regardless of who caused the accident. Therefore, the level of car accident coverage you carry will impact your settlement. For this reason, drivers in these states are often required by law to carry more than just basic liability policies, including:

Types of Auto Insurance Coverage
Types of CoverageWhat it Covers
Collision Collision helps to recover the cost of repair or replacement if your car is damaged due to a collision with another object, such as a tree, fence, or another car.
ComprehensiveComprehensive covers damages to your car that happen due to causes out of your control, such as storms, theft, fire, etc.
Medical PaymentsMed Pay helps to cover the medical expenses from injury to you or your passengers in an accident irrespective of the fault.
Personal Injury Protection (PIP)PIP, as the name suggests, kicks in to cover your personal injury expenses in an accident irrespective of fault. Along with medical expenses, PIP also covers lost wages.
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For example, drivers in no-fault states carry PIP or MedPay to cover the expensive medical costs after an accident.

However, certain circumstances can be eligible for compensation, including injuries caused by drunk drivers or company vehicles. Take a closer look at your policy and speak with the adjuster about your coverage before you start negotiating settlement amounts. 

Determine the Value of Your Car

Once you know how car accident settlements are handled in your state, file a claim with the appropriate insurance company and start calculating the value of your car and personal injuries. You can start gathering receipts and records of any repairs or parts you paid for out of pocket while the insurance adjuster is doing their investigation.

In general, you can expect the insurance company’s offer to be much less than the worth of your vehicle. 

The insurance adjuster will go to a company-approved mechanic, but you can speak to your own preferred mechanic (or two) and get a more accurate estimate of the repair costs and replacement parts. This way, you will have hard evidence to compare with the insurance adjuster when you negotiate a settlement.

If your vehicle is considered a total loss, do not accept the insurance company’s first offer. A total loss means your vehicle will cost more to repair than it is worth, but it does not mean you have to accept the lowest offer. 

Research your vehicle’s make and model through companies like Kelley Blue Book to find more accurate valuations. You can also call local car dealerships and discuss similar vehicle comps in your city. This will give you the leverage you need to negotiate a better settlement with the adjuster.

Keep Well-Documented Records

Hold on to the receipts of every item you pay for relating to the accident. Obtain written estimates from mechanics, keep records of repairs and replacements you have made in the past, and print hard copies of vehicle comps you find at local dealerships, Kelley Blue Book, Edmunds, and more. 

The more evidence you have regarding your vehicle’s worth and maintenance, the better you will be at negotiating a car insurance settlement.

Get a police report from the accident to support your claim. For example, if the other driver was ticketed at the accident, and you have photographic evidence of your vehicle’s damage, you may be able to negotiate a higher settlement. Further, emphasizing the emotional toll of the accident with documented proof of how it impairs your daily life will only strengthen your argument.

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What You Need to Know About Negotiating a Car Insurance Settlement

Just as no two accidents occur in the same way, no two claims are identical. As such, there’s no one-size-fits-all method for handling a claim from start to finish. You’ll need to know what to expect in advance to prepare your case. Depending on your policy, your state’s laws, and the unique circumstances of your accident, you might have many opportunities to negotiate a settlement.

Sometimes, it’s as simple as explaining your side to the adjuster. If your vehicle is considered a total loss by the insurance company, you can show them your valuation from a trusted source. You also have the right to consult a mechanic you trust regarding the necessary repairs. 

However, consider the age of your vehicle and go into the negotiation with realistic expectations. If you drive an older car, insurance adjusters can argue that new replacement parts add value to the vehicle. In this case, they will often consider your car a total loss and make you an offer instead.

Negotiating with a car insurance adjuster takes time and patience. It is important to do your research and come prepared to negotiate a fair insurance settlement. If you do not trust yourself to follow through on everything in this guide but still feel you are owed a settlement, consult with an attorney after the car accident.