What is a Demand Letter?

Recovering compensation after an injury caused by the negligent actions of another individual or entity can be challenging. Insurance carriers are notoriously difficult to deal with, particularly when it comes to recovering a fair settlement. It is not uncommon for insurance carriers to make lowball offers, and they may even deny a claim altogether. Here, we want to discuss one of the most important parts of securing compensation from an insurance carrier – the demand letter.

A Demand Letter in an Illinois Personal Injury Case

One of the first documents you will send to an insurance carrier is a demand letter, but please understand the importance of working with a personal injury lawyer who has experience handling these letters.

A demand letter is the first step in securing the compensation you are entitled to, but it must contain certain elements. Before beginning a demand letter, the injury victim and their lawyer will need to have a decent understanding of how much monetary loss is expected. This includes medical expenses, property damage losses, lost wages, out-of-pocket losses, pain and suffering damages, and more.

A demand letter is a formal letter that will be concise and clear, and it should be professionally written. Some of the information that will be present in a demand letter includes:

• A description of the incident that led to the injury
• All facts surrounding the claim
• A list of the injuries and medical treatment rendered
• Discussion of possible medical care needed moving forward
• Copies of all expenses related to the injury and property damage
• Medical records

This demand letter will also include the dollar figure you are seeking from the insurance carrier as well as a clear date with which a response is expected. The letter will include reference to a forthcoming personal injury lawsuit if an adequate settlement amount is not offered by the insurance carrier.

Possible Responses to a Demand Letter

Since the demand letter is one of the first documents sent to the insurance company, you can be sure that this will not likely be the conclusion of the case. The insurance company will send a response, which may be:

• An acceptance. In rare circumstances, the insurance company may accept the demand amount and then pay. This is not very likely unless the fault of their policyholder is incredibly clear.
• A counteroffer. This is most often the response from the insurance carrier, and they will typically fire back with a counteroffer far below your initial demand. This is the starting point for future negotiations.
• A denial. There may be times when the insurance carrier flat-out denies the claim. When this happens, it might be necessary for the injury victim to file a personal injury lawsuit against the at-fault party in civil court.

The demand letter is the opening foray into settlement negotiations. Again, we strongly encourage you to work with a skilled personal injury lawyer in Illinois who can walk you through this process and ensure you are exploring all avenues for compensation.