How Insurance Adjusters Calculate Claim Value : Explanation by an experienced Las Vegas Car Accident Lawyer

by Gina Corena

Last Updated on September 27,2023

How Insurance Adjusters Calculate Claim Value : Explanation by an experienced Las Vegas Car Accident Lawyer

Some car accident victims choose to save on attorney fees by handling insurance claims themselves after a minor collision. Yet, car accident victims involved in major collisions almost always hire a personal injury attorney. This logic might make sense to you, but it’s almost always in your best interest to consult with an attorney, even after a minor collision.

Car accident attorneys do far more than push paperwork for their clients. They protect you from insurance company tactics by handling communication and negotiating to get you the most compensation possible for your claim. One of the most critical tasks a car accident attorney does for clients is placing a value on their car accident claims.

You might think that valuing your claim is as simple as adding up medical bills and property damage to your car. It’s true that adding up the quantifiable aspects of a car accident claim is not that difficult, but the intangible loss that accident victims suffer is not easily quantifiable. Below we offer more information about how lawyers and insurance companies value car accident claims in Las Vegas.

How a Las Vegas Car Accident Lawyer Helps Determine an Estimate for Vehicle Damage

Compensation for damage to your car is pretty straightforward and typically does not cause much contention between accident victims and insurance companies. Some details lawyers and insurance companies use to place a value on your vehicle damage include:

  • The initial value of your car
  • Condition of your car at the time of the accident
  • Amount of depreciation
  • Mileage
  • Cost of replacement parts

Elements Used by Insurance Adjusters to Value a Car Accident Claim

After a car accident, the liable driver’s insurance company needs to pay for injuries up to the policy limit. Economic and non-economic damages make up the total value of the claim. Economic damages include medical treatment costs and lost wages due to injury and hospitalization. In severe accidents, future medical treatment costs and future lost wages might also be part of the claim.

Non-economic costs include damages that are more difficult to quantify such as physical pain and suffering, mental anguish, and any other emotional damages. Placing a value on these aspects of your car accident claim can be challenging. Insurance carriers rely on a few different methods to calculate the total value of the claim. Most methods are a variation of the multiplier method and some insurance companies refer to the equation they use to value pain and suffering as the damage formula.

Using the Multiplier Method to Calculate Pain and Suffering in Your Claim

The multiplier method is the primary method insurance companies use to calculate pain and suffering. The formula is the complete total of economic damages, typically referred to as special damages, multiplied by a particular number referred to as the multiplier. It looks like this:

Sum of Special Damages X multiplier = Pain and Suffering

The multiplier is typically a number between one and five but can be greater.  It increases when injuries are severe, an accident has aggravating circumstances, and when accident victims need a long time to recover from their injuries. Typically, the multiplier falls somewhere between 1.5 and 3 for minor accidents. Insurance adjusters often multiple by five or more when severe injuries and permanent disability occurs. Some are critical of this method for calculating pain and suffering because the multipliers are arbitrary and produce inconsistent results among claims.

The Damage Formula for Las Vegas Car Accident Claims Explained

The multiplier method is part of the broader damage formula that insurance companies use to calculate the value of a car accident claim. Once an adjuster has calculated pain and suffering, they add up other damages to reach a number. This total is often the starting point for negotiations. The damages typically included in most car accident claims include:

  • Medical treatment costs
  • Estimated future medical expenses if applicable
  • Lost wages
  • Lost earning capacity if applicable
  • Pain and suffering and other non-economic damages from the multiplier method

Once the insurance adjuster and lawyer have a starting point, other facts can come to light and force the need to adjust a settlement amount. Additionally, the range of the multiplier leads to a wide range for a settlement amount.

Accuracy of Car Accident Claim Calculators: What You Need to Know

Online you will find an array of car accident claim calculators. Any method used to calculate a settlement amount is only an estimate. Complete accuracy is impossible because car accident settlement calculators cannot collect all the information they need to determine an accurate estimate. Similar to the criticism of arbitrary multipliers in the damage formula, car accident calculators have no common system to provide consistency among different calculators. It’s likely that if you try three different car accident claim calculators, you will have three different amounts that aren’t anywhere close to each other.

The accuracy of a car accident claim calculator is highly dependent on the information the calculator allows you to input before it offers the value of your claim. More information allows the calculator to consider the specifics of your claim. It’s not in your best interest to use car accident claim values created by car accident claim values, but they can provide a ballpark estimate to help you get closer to a more reliable number to understand the settlement offer that will come your way from the insurance company.

A Note About the Per Diem Method for Calculating Car Accident Claims

Although far less popular, some personal injury lawyers and insurance companies use the per diem method to calculate pain and suffering for a car accident claim. The per diem method, sometimes referred to as the daily rate method, is calculated by coming up with an amount of money that an accident victim should receive every day or week they must suffer from injuries related to the accident.

How a Car Accident Attorney Can Help Value Your Claim

Personal injury attorneys are skilled negotiators who have extensive training in the calculation of accident claims. Their training and professional experience allow them to come up with the maximum value of your claim, removing many of the inconsistencies that come with calculators and other methods.

If you have suffered injuries in a Las Vegas car accident, contact Gina Corena & Associates online or at 702-680-1111 for a free consultation to discuss the value of your claim.

At Gina Corena & Associates, we value your needs and what best serves your interests. Our results and our service to our clients speak about the trust and value we provide to them at this difficult stage. Backed with years of experience and trust, we know the necessities for your case. If you have any query or cannot find what you are looking for, visit our website, and check out other information related to car accidents and our services. We can help – Contact us today!

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