While all the auto accident billboards you see on the highway draw your attention with the big flashy large number settlement amount, the reality of personal injury claims is your “net” recovery is often quite less than that total gross number.
Besides the obvious deductions you are going to pay in the form of attorney fees and case expenses, there are numerous collateral sources that impact your bottom line net recovery. They are as follows:
Cash advances: You may have taken out a cash advance from a funding company during your case in order to help you get by while you were trying to work towards case settlement. This will need to be paid back out of your settlement.
Health insurance: Hopefully you had health insurance throughout your case. If so, you were likely able to reduce the out of pocket costs of your treatment costs by using your health insurance coverage. If so, you might potentially need to reimburse your health insurance provider out of your settlement.
Medical lien: You might owe a medical provider for treatment it provided to you during the case at no up front cost. In other words, you received up front payment in the form of free medical care at the time, and this now needs to be paid back out of your settlement.
Medical payments coverage: Med pay is an optional item to purchase on your auto insurance policy. If you have some medical payments coverage on your auto policy, you should have received some payments in the form of cash payments either directly to your medical providers or directly to you. Depending on how you resolve your tort claim, and if it’s worth your uninsured motorist carrier or the liability carrier, you may have this amount of money offset from the gross settlement amount.
Workers compensation claims: This will only apply if you got into an accident while you were working on the clock. If so, you might have an additional claim from your “tort” claim in the form of a workers compensation claim. This could allow you to recover additional money than you would have if you had not been working during the accident.
Disability Insurance: Assuming you owned a disability policy when the accident occurred, you might have short-term or long-term disability benefits that you can be paid during your recovery. This will also be dependent on the severity of your injury and treatment. Like health insurance, you might owe some form of reimbursement to your disability insurance carrier out of your settlement depending on how the policy is written.