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How Long Does a Settlement Take After a Demand Letter is Sent?

The litigation process follows a relatively standard procedure once an attorney meets with a client. As the two negotiate, they determine when an appropriate time to issue demands will be. Initially, they have two choices – issuing a demand letter or going straight to a lawsuit. The timeline following a demand letter, then, diverges into two branches depending on how the parties react.

The Immediate Future

In personal injury or car accident cases, demand letters sent to an insurance company may receive one of several replies. It is entirely possible, in fact, for the company to simply ignore the letter altogether. Typically, however, the process will enter negotiation between attorney and insurance company.

Very rarely do insurance companies either accept a claim without negotiation or deny them altogether. Normally, they prefer not to get the courts involved at all – and denying a claim runs the risk of initiating a lawsuit with the plaintiff’s attorney. Most often, the insurance company makes a counteroffer – which the plaintiff may accept, reject or respond with a counteroffer of their own.

If a company does not respond – a rare, but not unheard-of occurrence – it is typical to follow up on the demand letter. Barring that, most personal injury lawyers will move to a lawsuit to stay within the statute of limitations for civil claims.

The negotiation process can take some time, up to several months. This is, however, a faster, easier, and cheaper process than going through the courts via a lawsuit. All parties involved will typically prefer to avoid having to go to court, and much prefer to settle through negotiated settlements.

Reaching a Settlement

The majority of civil suits settle long before a trial is necessary. The negotiation process is a multifaceted procedure that involves all parties meeting with their respective lawyers and discussing the case. Settlements depend on the strength of each side’s case, and their available resources.

What Happens If the Parties Cannot Reach a Settlement?

Sometimes, however, the two parties cannot reach a settlement. This can be because the litigating party decides to reject the insurance company or defendant’s counteroffer. In rare cases, it can be because the defendant party does not respond to the demand letter in the first place. Regardless, the next step for most attorneys is to initiate a lawsuit.

It is crucial that lawyers initiate this process quickly once it becomes clear that reaching a settlement will be impossible. The statute of limitations for civil suits means here is a strict time limit on starting litigation following an accident or injury.

Following initiation of a lawsuit, the parties enter another round of negotiations known as the discovery process. The two parties send requests for legal documentation and evidence, and normally this is where a lawsuit ends – resulting in an out of court settlement long before the actual trial date. In cases that move directly to filing a lawsuit, this is normally the end of the line for these suits.

The discovery process can take anywhere from six months to a year, and the if the parties cannot reach a settlement, they may go before a mediator to arrange a settlement. Only in the most acrimonious cases does a trial occur, and these will only happen once all parties have concluded that they cannot reach a settlement.

Once a trial date is set, the actual trial can last from a day to several weeks, depending entirely on the schedule of the judge, lawyers and parties. It is common for trials to be rescheduled frequently, often for simple reasons, and this is often why they take more than one day. In either case, a trial is the end of the line for civil suits – sometimes taking place up to a year following the original incident.

If you have additional questions, our Orange County personal injury lawyers can help you navigate the legal process.