"The Law" Insurance Companies Don't Want You to Know

Insurance companies and their claims adjusters handle personal injury cases every day.  The claims adjusters are trained in negotiation and how to speak with injured parties to settle claims for less than their full value.  The insurance company has a significant advantage over the typical personal injury claimant when it comes to claims experience, knowing the law, the value of claims, and negotiation tactics.  This is not surprising; it’s all they do.
How can a personal injury claimant gain the upper hand against the insurance company without an attorney?  Gaining the upper hand can be difficult due to the knowledge and experience disparity.  However, if you have a claim that is worth less than $10,000, there is a law in Oregon that transfers this balance of power to the claimant.  It’s a law that forces the insurance company to give you their best offer.  Using this law will eliminate the unnecessary negotiating back and forth and the need to hire an attorney.
The law is ORS 20.080.  This law allows personal injury claimants to recover attorney fees when the insurance company has not made a fair offer.  Attorney fees, however, can only be recovered if the claimant receives a verdict at trial or arbitration that is greater than the offer made by the insurance company before filing the lawsuit.  Attorney fees after a trial or arbitration can range anywhere from $15,000 to $60,000.  As you can guess, insurance companies do not want to pay attorney fees.  As a result, they will usually make a reasonable offer in response to a demand made pursuant to ORS 20.080.
So, how do you make a demand under ORS 20.080?  The personal injury claimant must do all of the following things to take advantage of the law:

  1. Write a demand letter for $10,000.00 or less and send it to the adverse insurance carrier via certified mail – return receipt requested;
  2. Include with your demand letter copies of all medical records and bills for medical treatment, police reports (if any), wage loss documents (if any), and other documents to adequately and reasonably inform the insurance company about the nature and scope of your claim; and then
  3. Wait 30 days.

At the end of this article is a sample ORS 20.080 demand letter that complies with the above requirements.  If you use this letter, be sure to attach the above-cited documents and send the letter via certified mail return receipt requested.
ORS 20.080 requires the insurance company to respond to your letter with their best offer within 30 days.  As stated above, if the claimant beats the final settlement offer at trial or arbitration, the claimant can recover their attorney fees.
To maximize your settlement offer, do not negotiate with the insurance claims adjusters before the 30 days has elapsed.  If you negotiate, you may end up negotiating yourself into a lower settlement.  For example, if an adjuster has authority to settle your claim for $9,000, they may initially offer you $6,000.  Unknowingly, you may negotiate your case lower than the claims adjuster’s top authority to settle the case.  You gain nothing by negotiating.  Near or on the 30th day, the claims adjuster will automatically offer you their top settlement value.  Remember, once you have sent the ORS 20.080 letter you are in the position of power.       
If a claims adjuster asks you to make a counter offer or to negotiate, tell them you are waiting until the 30 days expires, and at that point, you will make the decision to accept or decline whatever their offer is at that time.  Even if they tell you they are offering their top dollar, wait the 30 days.  Our Oregon personal injury attorneys have seen many claims adjusters increase their offers at the last minute after saying that they had already offered their “top dollar.”
Once the 30 day period is up, accept the offer if you feel it is fair.  If you are unsure as to whether or not you want to accept the offer, tell the adjuster how you feel.  You can then try to negotiate an increase of the offer by $2,000, $1,000, $500, or whatever amount you feel is fair.  Tell them you will settle the claim and not hire an attorney if they increase their offer by a specific amount.  Alternatively, if you don’t know if you should settle, call an expereinced personal injury attorney in Oregon for advice.
ORS 20.080 was enacted by the legislature as a tool for individuals with smaller cases to do two things: 1) to compel fair compensation from insurance companies and entities; and 2) to encourage attorney representation of clients with smaller cases. 
The legislature found that the cost to litigate smaller cases was high, and that attorneys were reluctant to take small cases as it wasn’t monetarily advantageous to the client or the attorney.  The legislature also found that insurance companies and other entities knew of these problems and would sometimes make lowball offers knowing a claimant would be forced to settle due to the cost of litigation and impracticality of hiring an attorney.  ORS 20.080 essentially levels the playing field for claimants with smaller claims using a threat of attorney fees that allows a claimant to hire an attorney.
DISCLAIMER: This article is not intended to be an exhaustive resource for using ORS 20.080 to settle an Oregon personal injury claim.  We strongly recommend talking with a personal injury lawyer if you are thinking about using this approach to settling your claim.  There are many issues and facts to consider when deciding to settle your claim using an ORS 20.080 demand letter.   Depending on the facts of your case, it may not be in your best interest to settle your claim using ORS 20.080.  Moreover, there are many time deadlines that need to be observed when handling your own personal injury case.  Again, we strongly recommend talking with an attorney before handling a personal injury case or using ORS 20.080 on your own.
                            **  SAMPLE DEMAND LETTER FOR INJURIES ONLY CLAIMS  **

ADDRESS 1                                                                                            30-DAY DEMAND
ADDRESS 2                                                                                            Via Certified Mail
ADDRESS 3                                                                                            Return Receipt Requested
Re:       Your Insured:                                          XXXXXX
            Date of Loss:                                          XXXXXX
            Claim Number:                                       XXXXXX                     
Dear Sir or Madam:
On (DATE), I was injured in an automobile accident caused by your insured.  The collision occurred in (COUNTY), near/at/on (LOCATION OF ACCIDENT).
Pursuant to ORS 20.080, please consider this letter as a 30-day demand for damages sustained by myself, (NAME), in the amount of $10,000.00, inclusive of all economic and noneconomic damages not previously paid by the personal injury protection insurance carrier.
Should this demand not be satisfied within 30 days from the date of this letter, I will hire an attorney, file the appropriate lawsuit against your insured for damages in the (COUNTY WHERE ACCIDENT OCCURRED) Circuit Court, and will ask the court for attorney fees and costs in excess of these demands.
As required by ORS 20.080, enclosed please find copies of all related medical records, bills, and incident reports.  If you are unwilling to accept service of this demand on behalf of your insured, please notify me in writing within 10 days upon your receipt of this letter.
You can contact me at: (ADDRESS).  My phone number is (PHONE NUMBER).  I look forward to your response.


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