After a car accident in Texas, you may receive a settlement offer from the at-fault driver’s insurance company. Accepting an offer can resolve your claim without going to trial, but it can also mean giving up your ability to seek additional compensation.
A settlement agreement is a legally binding contract that establishes the terms of a settlement, including the amount paid and the claims being resolved. Before signing, it is important to know exactly what the agreement covers and which rights you may be giving up.
Here are five things to know about car accident settlement agreements in Texas.
Settlement Agreements Are Final
Most car accident settlement agreements are intended to provide a final resolution of the claims they cover. Once you sign a valid agreement, you generally cannot reopen the settled claims simply because you change your mind or believe you should have received more money.
This can become a problem when someone accepts an insurance company’s offer before knowing the full extent of their injuries or financial losses. If additional medical bills arise after the settlement, the agreement may prevent them from seeking more compensation.
Although certain legal grounds, such as fraud or duress, may support challenging a settlement agreement, successfully doing so can be difficult. Disappointment with the settlement amount is generally not enough.
Before accepting an offer, consider whether the proposed compensation accounts for your current expenses, anticipated treatment, lost income, and other accident-related losses.
Settlement Agreements Cover Legal Claims You Didn’t Make
A car accident settlement agreement usually includes a release of liability. This provision identifies the legal claims you agree to give up in exchange for the settlement payment.
The release may extend beyond the specific claims you originally raised against the other driver. Depending on its wording, it can cover other legal claims arising from the same accident, even if you did not know those claims existed when you signed.
For example, you might initially pursue compensation based on another driver’s negligence. Later, you could discover evidence supporting an additional legal theory related to the collision. If the settlement agreement released that claim, you may no longer be able to pursue it.
Texas courts generally interpret releases according to their terms. The claims covered by a release must fall within its language, making the wording especially important.
Settlement Agreements Cover Injuries You Didn’t Know You Had
Some car accident injuries take time to develop, and others may turn out to be more serious than initially expected. Unfortunately, settlement agreements often include language releasing claims for both known and unknown injuries.
For example, you might settle a claim for a neck injury, only to discover later that you need surgery or ongoing treatment. If the agreement covers future injuries and medical expenses, you may be unable to seek additional compensation.
This is why it is important to consider your future medical needs and the possibility of lasting complications before accepting a settlement.
Settlement Agreements Can Cover People You Didn’t Know You Could Sue
More than one party may be responsible for a car accident. Depending on the circumstances, an employer, another driver, or even a vehicle manufacturer could share liability.
Some settlement agreements include provisions that release parties beyond the person or insurance company making the payment. This means you could unintentionally give up claims against someone who may also owe you compensation.
Settling with one party does not automatically release others from liability. However, the agreement’s wording can determine which additional parties are released.
Settlement Agreements From Insurance Companies May Favor the Insurer
Insurance companies generally want to resolve claims while limiting their exposure to additional liability. Their settlement agreements may contain broad release provisions and other terms designed to protect their financial interests.
For example, an agreement may release claims for future injuries, include additional parties, or establish requirements for handling medical liens and settlement payments.
These provisions are not necessarily improper, but they can affect your rights and the amount you ultimately receive. A Friendswood car accident attorney can review the agreement, identify potentially unfavorable terms, and negotiate changes before you sign.
Contact The Law Firm of Alton C. Todd Personal Injury Lawyers to Schedule a Free Consultation With a Friendswood Car Accident Attorney
Car accident settlement agreements can affect your ability to pursue compensation long after the initial payment. Once you sign a release, you may give up claims involving additional injuries, legal theories, or responsible parties.
If you were injured in a car accident in Texas, contact The Law Firm of Alton C. Todd Personal Injury Lawyers today at 281-992-8633 to schedule a free consultation with a Friendswood car accident lawyer. We handle personal injury cases on a contingency fee basis, so you pay no attorney’s fees unless we recover compensation for you.