The vast majority of personal injury cases in New York settle before trial. This is not because the cases are weak. It is because both sides have financial incentives to resolve the dispute without the cost, uncertainty, and delay of a trial. A settlement gives the injured person guaranteed money now. It gives the insurance carrier a closed file at a known cost. The question is not whether settling is good or bad. The question is whether the amount offered reflects the full value of the case.
How out-of-court settlements happen
An out-of-court settlement can happen at any stage of a case — before a lawsuit is filed, during discovery, after depositions, on the eve of trial, or even during the trial itself. The earlier the settlement occurs, the lower the litigation costs, but also the less information both sides have about the strength of the case.
In many cases, the first settlement discussion happens during the pre-litigation phase, when the attorney sends a demand package to the insurance carrier. The demand includes the medical records, bills, wage loss documentation, and a written summary of the case. The carrier evaluates the demand, assigns a reserve, and responds with an offer. If the offer is adequate, the case settles. If it is not, negotiation continues or a lawsuit is filed.
Filing a lawsuit does not end settlement discussions. It often accelerates them. Once litigation costs begin to mount and the carrier sees the case is being prepared for trial, the financial calculus changes. Many cases settle during or after discovery, when both sides have exchanged evidence and can evaluate the strengths and weaknesses more clearly.
When settling makes sense
Settling makes sense when the amount offered fairly compensates you for your damages. A fair settlement reflects the full value of your economic losses (medical expenses, lost wages, loss of earning capacity), your non-economic losses (pain and suffering, loss of enjoyment of life), and any reductions for comparative negligence or coverage limits.
Settling also makes sense when the risk of trial is significant.
A jury verdict is unpredictable.
A jury could award more than the settlement offer, but it could also award less — or nothing.
If liability is contested, if comparative negligence is a factor, or if the defense has a credible argument on damages, a guaranteed settlement may be preferable to the uncertainty of a verdict.
When settling does not make sense
Settling does not make sense when the offer is inadequate. An offer that does not cover your medical expenses and lost wages — let alone pain and suffering — is not a settlement worth accepting. It is a starting point for negotiation.
Settling too early can also be a mistake. If your medical treatment is ongoing and your condition has not stabilized, the full extent of your damages is unknown. Accepting a settlement before you reach maximum medical improvement means accepting a number based on incomplete information. If you need additional surgery after the settlement is signed, you cannot go back for more.
The role of trial preparation in settlement value
Cases that settle for the most money are not the cases where the attorney accepts the first offer. They are the cases where the attorney has prepared the case as if it will go to trial. When the carrier sees a fully prepared case — expert reports filed, depositions completed, trial exhibits assembled, a motion for summary judgment on liability — the carrier’s risk assessment changes. The potential cost of losing at trial drives the settlement number higher.
This is why attorney selection matters. A firm that prepares cases for trial and has the resources and willingness to try them creates a different negotiating dynamic than one that settles every case pre-litigation. The insurance carrier knows which firms try cases and which do not, and that knowledge affects every offer.
How Schwartzapfel Holbrook approaches settlement negotiations
At Schwartzapfel Holbrook, we prepare every case with the expectation that it may need to be proven at trial. That preparation — thorough medical documentation, expert analysis, complete discovery, and trial readiness — is what gives us the leverage to negotiate settlements that reflect the full value of the case. We do not recommend settling until the case is fully developed and the offer accounts for every component of the damages. We are selective about the cases we accept, and when we take a case, the carrier knows it will be tried if the offer is not adequate.
Schwartzapfel Holbrook / Fighting For You