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What is an Auto Accident Settlement?

Article Details
  • Written By: Ken Black
  • Edited By: Andrew Jones
  • Last Modified Date: 14 August 2018
  • Copyright Protected:
    2003-2018
    Conjecture Corporation
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An auto accident settlement is an agreement between two parties stating who is responsible for a motor vehicle accident, and what the terms of compensation or restitution will be. Generally, the settlement is negotiated between representatives of the insurance companies, but could be a product of private meetings between the parties directly involved. The auto accident settlement generally includes compensation for vehicle damage, medical bills, and any other type of property damage that may have resulted.

The parties may choose an auto accident settlement for many different reasons. One of the primary reasons to consider a legal settlement is to ensure the issue is never decided by a judge. This gives more control to the participants to come up with a solution that is mutually agreeable to both sides. It also cuts down on the costs of court actions, because very little time is taken up litigating the case in court, although a judge may sign off on the agreement as a acknowledgment.

If an auto accident settlement is to be valid, both parties involved must be able to fully understand the legal document. In cases where one or more of the parties directly involved are negotiating, it is highly advisable to seek legal advice. Often, the acceptance of a settlement offer will preclude that individual from seeking further financial remedies in the future. Even if other potential problems are discovered, the individual may have no legal recourse in such a case.

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Before agreeing to any type of auto accident settlement, the parties should gather as much information as possible. This includes getting quotes for repairs, collecting any bills resulting from the accident and providing information on expected costs in the future. Ongoing costs could include procedures such as physical therapy to help those injured regain mobility and strength in certain areas of the body.

Generally, in order for these settlements to be valid, they must be signed by both parties and should be notarized. Not all jurisdictions may require notarization, but that adds validity to the fact that both sides made the agreement in good faith. Without a notarization, one side could claim the other side forged or somehow manipulated the original documents.

An individual proposing an auto accident settlement should carefully consider the advantages and disadvantages. While that person may save some court costs, those could be eaten up quickly by an out-of-court settlement. Therefore, each person must decide whether the deal is advantageous for them before proceeding with the signing.

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