The “Preliminary Evaluation” Tactic
One tactic that adjusters will try to use during their negotiations with a NJ personal injury law firm is called the “preliminary evaluation technique.” It’s a tactic that they like to use to get the firm to agree to a settlement that’s closer to their minimal expectations.
For the sake of illustration, let’s say that the defendant is clearly liable and the main remaining issue is the value of the case. In this case, the personal injury law firm may estimate that the value of the case is between $60,000 and $70,000. Here, the goal is for the personal injury law firm to settle as close to the highest estimated value as possible (i.e., $70,000). If they are fortuitous, they will settle the case for more even than that.
Initially, the NJ personal injury law firm will send the adjuster a demand letter requesting $100,000. The adjuster may stall before coming up with a typical strategic response. It might sound something like this: “I am trying my best to generate a preliminary evaluation before putting it in front of the claims supervisor for approval. I don’t think it’s possible to meet your $100,000 demand, though. I have initially valued the case between $65,000 and $75,000. I hope that these are in accord with your own expectations.”
At this point, the adjuster’s evaluation is close to the NJ personal injury law firm’s own expectations. In fact, the adjuster’s evaluation appears to value the case even higher than the law firm. The law firm might now predict that if they can meet the adjuster at the adjuster’s halfway point (which would be $70,000), then they would have accomplished goal of reaching the highest estimated value. The law firm may feel good at this point because they are in a position to negotiate above their own evaluated range. As a result, the law firm may elicit a positive response to the adjuster’s communication such as “I think that sounds good” or “I think we can settle for $75,000.”
The NJ personal injury law firm will later receive a communication from the adjuster when the adjuster is ready to make a firm offer. The adjuster will then tell the law firm that the claims supervisor denied the adjuster’s preliminary evaluation. The claims supervisor had valued the case at $55,000, but after an intense debate the adjuster was able to get the supervisor to agree to a firm final offer of $60,000.
Now the NJ personal injury law firm is hit with an offer that barely meets its lowest estimated value for the case. The adjuster’s “preliminary evaluation” of $65,000 to $75,000 was just a curve ball. The law firm’s positive response to the adjuster’s preliminary evaluation let the adjuster know that a substantially lower settlement could be offered. In all likelihood the law firm will now only be able to settle for slightly more than their own minimum evaluation of $60,000 (which might be $62,000). The adjuster knows that the law firm will not go to trial over $3,000 just to meet the halfway point of its expectations. As a result, instead of settling as close to the highest estimated value as possible they were forced to settle for something closer to the lowest of their expectations.
The “preliminary evaluation” is merely bait to see if the law firm bites. When the law firm does bites on this non-binding range, they get lured into a range that is much lower than they expected. An experienced NJ personal injury law firm will know how to deal with this strategy. They will tell the adjuster than they will only respond to a firm offer of settlement that can be taken to the client.
If you’ve suffered an injury and would like a free case evaluation from a NJ personal injury law firm, please contact the law office of Gerald Clark to schedule an appointment.