Nearly every personal injury claim will settle at some point. Assuming it is a viable case with both liability as well as damages that can be proven, the case will likely settle. A claim may also settle without a lawsuit having to be filed. Or, the case can settle during litigation at anytime before the case is decided by a judge or jury.

Regardless of when a case settles, there is a procedure that must be followed, in order for the settlement to be binding on the parties. Here is the typical settlement process for a personal injury case.

Once the two sides agree on a settlement number, then a release is signed. This is an enforceable legal document that states in exchange for the settlement funds, the claim is over and cannot ever be reopened in the future by the claimant. For example, if you settle your auto accident claim for $10,000, before the insurance company is obligated to pay you this money, you must provide them with a signed release.

Please note if the case is in litigation your attorney will, along with the insurance company’s lawyer, sign a Stipulation of Dismissal and file it with the court where the lawsuit was filed.

Please note that settlements of workers’ compensation claims work a little bit differently. If there is a settlement, instead of signing a release, the claimant either signs a section 19 agreement, or lump sum settlement, depending on the terms of the settlement.

At the time of settlement for a personal injury case, any liens filed against the case must be addressed. Whether there are liens from any hospitals, private health insurance companies, or Mass Health (Medicaid) or Medicare, they must be negotiated downward by your attorney. That is because any reduction will result in more money in your pocket.

Hospitals and private health insurance companies must follow a precise legal process in order for their liens to be “perfected.” Even if the party asserting the lien does not properly lien the case, the money is still owed by the claimant. Please note Mass Health and Medicare liens arise automatically against a case, without needing to be “perfected.”