If you have insurance which pays you for property or other damages sustained (such as if an insurance company has paid you damages for a house fire), the insurance company will usually have a legal right to recover proceeds from any settlement or award that you receive from the person responsible for such damages. For example, if your home is completely destroyed and the insurance company pays to rebuild it, and you recover for the value of your home from the person who caused the fire, the insurance company will have a lien against your recovery.
How Much Do I Have to Repay?
We work with clients and insurance companies in personal injury lawsuits to determine how to fairly allocate settlement proceeds and jury verdicts between the client who has been injured, the insurance company, and our firm. For instance, in the case of a fire which destroys a home, insurance companies understand that in order to recover against those liable a homeowner and attorney need to spend time and resources bringing a lawsuit. If the client was required to pay the full amount for the house to the insurance company, and if the attorney was not compensated for successfully obtaining a recovery, there would be no incentive for the homeowner or the attorney to initiate litigation for this aspect of a claim.
As a result, insurance companies usually will agree to a reduction of any lien that they may have so that there is an incentive for the homeowner and legal counsel to pursue compensation.
Workers’ Compensation Benefits
Similar to insurance companies who pay money to their insureds for property damages, workers’ compensation payers may also have a claim against proceeds received from a verdict or settlement. Their right to recover will be based on a number of factors specific to each case.
We Will Help You Understand the Rights of Insurance Companies and Others
Before agreeing to a settlement, it is important that clients understand the portion of the settlement that may be owed to insurance companies or others who may have compensated the client for property damage or wages. In the course of litigation, we help clients understand these aspects so that they can make an informed decision as to whether to accept any settlement offer that may be made.