After an accident, you may hear terms such as “insurance claim,” “personal injury claim,” and “lawsuit” used to describe the process of seeking compensation. Although these terms are sometimes used interchangeably, a claim and a lawsuit are not the same thing.
A personal injury claim generally involves seeking compensation from an insurance company or responsible party without going to court. A lawsuit is a formal legal action filed in court. Many personal injury cases begin as claims and are resolved through settlement negotiations. However, filing a lawsuit may become necessary when the parties cannot agree on liability or fair compensation.
Understanding the difference can help you know what to expect after an injury.
What Is a Personal Injury Claim?
A personal injury claim is typically a request for compensation after someone else’s negligence causes an accident or injury. The claim may be submitted to an insurance company that provides coverage for the responsible person or business.
For example, after a car accident, an injured driver might file a claim with the at-fault driver’s liability insurance company. Other claims may involve homeowners insurance, commercial liability insurance, or another type of coverage.
The claims process may involve:
- Investigating how the accident happened
- Collecting photographs, videos, and accident reports
- Obtaining medical records and bills
- Documenting lost wages and other financial losses
- Identifying available insurance coverage
- Calculating the injured person’s economic and non-economic damages
- Submitting a demand for compensation
- Negotiating with the insurance company
If the parties agree on an appropriate settlement, the case may be resolved without filing a lawsuit.
What Is a Personal Injury Lawsuit?
A personal injury lawsuit is a formal civil case filed in court. Instead of simply negotiating with an insurance company, the injured person, known as the plaintiff, asks the court to hold the defendant legally responsible for their damages.
Filing a lawsuit does not necessarily mean that a case will go to trial. The parties can continue negotiating after litigation begins, and many lawsuits ultimately resolve through settlement.
However, a lawsuit creates a formal process for resolving disputes. Depending on the case, the parties may exchange evidence through discovery, take depositions, hire expert witnesses, file motions, and eventually present their arguments to a judge or jury.
When Should You File a Personal Injury Claim?
In many cases, filing an insurance claim is one of the first steps after an accident. A claim gives the insurer an opportunity to investigate the incident and determine whether its policy provides coverage.
You may file a claim when another person or company appears responsible for your injuries and applicable insurance coverage is available. Starting the claims process can also allow you to begin gathering evidence and documenting your losses.
However, filing a claim does not guarantee that the insurance company will offer fair compensation. Insurers may dispute liability, question the severity of injuries, or disagree about the value of damages.
You should also remember that filing an insurance claim generally does not stop the statute of limitations from running. Negotiations could continue while the legal deadline for filing a lawsuit approaches.
When Might You Need to File a Lawsuit?
A lawsuit may become necessary when an injury claim cannot be resolved through negotiations.
The specific reasons depend on the circumstances, but litigation may be appropriate when:
- The insurance company denies the claim
- The insurer refuses to offer adequate compensation
- The parties disagree about who caused the accident
- The insurer disputes whether the accident caused your injuries
- Your damages exceed available insurance coverage
- Multiple parties may share responsibility
- The case involves severe or permanent injuries
- The statute of limitations is approaching
Filing suit can also provide access to formal discovery procedures. These procedures may make it possible to obtain documents, testimony, electronic records, and other evidence that would be difficult to secure during informal insurance negotiations.
What Is the Difference Between a Claim and a Lawsuit?
The biggest difference is that a claim generally takes place outside the court system, while a lawsuit involves formal court proceedings.
Claims may be less expensive and less time-consuming to resolve because they rely primarily on investigation and negotiation. A settlement also gives the parties greater control over the outcome because they decide whether to accept the agreed amount.
Lawsuits tend to involve additional procedures, deadlines, and expenses. However, litigation may be necessary when the opposing party will not negotiate fairly or important facts remain disputed.
The two processes are also closely connected. Filing a lawsuit does not necessarily end settlement negotiations. In some cases, information uncovered during discovery may actually help the parties reach an agreement.
Do You Have to File a Claim Before Filing a Lawsuit?
Not necessarily. Whether a claim must be filed first depends on the type of case, the parties involved, and applicable state law.
For many ordinary negligence cases, an injured person may have the option to file a lawsuit without completing an insurance claim first. However, pursuing the claim process initially may provide an opportunity to resolve the dispute without litigation.
Other cases can have special procedural requirements. Claims involving government agencies, for example, may require an injured person to provide formal notice within a specific period before filing a lawsuit.
Because these requirements vary by jurisdiction and case type, it is important to determine which deadlines and procedures apply.
Contact a Personal Injury Lawyer at Feller & Wendt, LLC for a Free Consultation
Whether you should file an insurance claim, pursue a lawsuit, or take both steps depends on the circumstances surrounding your injury. While many personal injury cases are resolved through insurance negotiations, filing a lawsuit may be necessary when liability is disputed, an insurer refuses to offer fair compensation, or the statute of limitations is approaching.
Feller & Wendt, LLC can review your case, explain your legal options, and help you determine the appropriate path forward. Contact us today at 801-499-5060 to schedule a free consultation and learn more about pursuing compensation for your injuries and losses.
