Clients often ask, “Is it better to settle my injury case or go to trial?” Although this question can’t be answered with certainty, lawyers can advise clients what to do when presented with a choice between taking a settlement offer or moving on to trial. To answer this question, attorneys use the facts, the law, and their judgment to advise clients.
Why do Most Cases End with a Settlement?
Most personal injury lawsuits settle without a trial. There are many reasons for this, including:
- Reducing time and expense of litigation
- Avoiding the personal stress of trial
- Limiting the risk of loss for the plaintiff
- Limiting the risk of loss for the defendant
- Courts strongly encourage the parties to compromise
What percentage of Cases Settled Before Trial?
In fact, many sources state that 95% of all civil lawsuits settle. A recent Cornell Law School study found that the settlement rate was near 90%. Therefore, injured parties with legitimate legal claims can expect settlement is more likely than a trial.
Why Parties Choose to Settle Instead of Going to Trial
Whether to accept the money being offered by the defense or move onto trial is a difficult question to answer. Lawyers must consider the risk and reward. For example, if an insurance company offers $10,000 to settle an injury claim likely worth $10 million at trial, then the answer is obvious – go to trial!
However, the decision is more difficult if the insurance company offers $9 million to settle the same case. By offering an amount closer to the $10 million trial verdict, the insurance company is seeking to save itself $1 million by shifting risk to the injured plaintiff. The plaintiff must give up guaranteed $9 million today to take the risk a jury at a future trial will award them both the $9 million being offered plus another $1 million more. After considering the additional costs, time delays, personal stress, and risk a jury could award less than the current offer, most injured parties accept reasonable offers of settlement.
Is Settlement or Trial Better?
Although trials can be costly, time consuming, and risky, a big win at trial can result in high rewards. Injured parties can win multimillion-dollar verdicts if the judge and jury agree with them. However, the reverse can also be true. In fact, studies suggest that settlement is better than trial in most cases. Accordingly, whether to accept a settlement and forego trial is ultimately a decision that should only be made after consultation with an attorney.
What Happens After I Accept a Settlement?
When parties agree to settle a lawsuit, the lawyers create a legal contract to settle the lawsuit. This settlement contract provides for payment of the agreed amount of money in exchange for dismissal of a lawsuit.