This is a question that we frequently get in auto accident cases. In fact, we often get the question after the fact in the form of “Should I have spoken with the other driver’s insurance company.”
The answer is not completely clear cut and attorneys will disagree on the answer. However, most will probably agree that it is best when possible to consult with an attorney before any discussions with the opposing insurance company. As discussed below, this is particularly true of the “recorded statement.”
The reason for this is clear. The opposing insurance company’s interest is in direct conflict with your own. The insurance company will want to pay out as little as possible. This means that any discussions with them, no matter how friendly the claims representative seems to be, have the potential to harm your claim.
What may seem like a friendly discussion is in all likelihood a fairly (if not highly adversarial) encounter.
Notice of a Claim v. Discussion of a Claim
There is a difference between notifying the insurance company and entering into discussions with the insurance company. Typically, both yours and the other insurance company should be notified of the accident. But even this is often best done with the assistance of an attorney. The attorney will primarily be trying to determine insurance coverage. In many cases, the attorney will be looking for insurance that will allow you to get medical treatment where necessary. These early discussions are rarely if ever designed to settle a claim quickly. If they are, in most cases, you may consider seeking a second opinion from other attorneys.
Again, notice of the claim and discussion of the claim are two different things. The insurance company’s goal will be to pay out as little as possible on the claim. In fact, a zero payout would be optimal. This should be no surprise as insurance companies are in the business of making money and are not prone to acts of generosity.
To reach their goal, insurance companies will often make a very low settlement offer. Many times, injured persons will take the low settlement because they are in dire need of the funds for medical treatment or for lost wages which can quickly lead them and their families to financial ruin. Unfortunately, the settlement process can be quite complicated and lengthy. Rest assured a quick settlement is very rarely a fair settlement even if it provides some immediate relief.
The Recorded Statement
For those injured persons who recognize this fact and want to wait to determine their actual losses (medical bills, future lost income, permanent injuries and so on), the insurance company will request a recorded statement. Most lawyers will agree that you should not give a recorded statement to an insurance company without at least consulting with an attorney.
The recorded statement can be quite damaging for a number of reasons. In some cases, the statement may legitimately show that you do not have a valid claim. If you do not have a claim, then you do not have a claim. However, what is of concern is the recorded statement that is taken with the intent of undermining a legitimate claim.
Not all insurance companies or claims representatives engage in such tactics but when they do, it at a minimum greatly complicate your case. In cases of abusive tactics, these statements may be taken in an adversarial manner, sometimes resembling cross examination with the sole purpose of undermining or invalidating your claims. Because most injured persons have little experience with the legal system (including sometimes complex issues of insurance coverage, liability, fault, negligence or damages issues), they are very vulnerable to manipulation and abuse.
Do Not Delay
Again, not all insurance companies or claims representatives misbehave. There are some that are very fair and reasonable. The problem is that you may not know which is which. An attorney will. And if for no other reason, this is reason enough to seek the guidance of an experienced personal injury attorney in dealing with insurance companies.