Many people who have been injured in car accidents are concerned about the cost of a car accident lawyer. Everyone knows that legal representation can be expensive. How much are you likely to end up paying for legal representation to win your case?
The difference between car accident attorneys and other attorneys is the contingency fee that applies to these injury cases. This means that if your attorney is unable to recover compensation in your case, then he or she does not receive payment either. If you do win your case and receive some compensation, then the law firm or lawyer takes a percentage of what you receive, either from a verdict or an insurance financial settlement agreement.
To learn more about how contingency fees work and what you can expect to pay your lawyer by the time everything is said and done, read on.
Contingency Fee Percentage
The contingency fee percentage is the percentage of your case compensation that your lawyer will receive. This is different from one state to the next, but is generally somewhere between 25% and 40%. Somewhere around 1/3 is a standard and reasonable contingency fee percentage. In this case, if you were to recover $60,000 in your case, your lawyer would receive $20,000.
This is pretty straightforward, but there are some important details to note. For example, in some states the percentages will shift based on the stage of the case and the amount of money recovered. The contingency fee can also depend on whether or not the at-fault driver has responded to your complaint. The allowed percentage can be lower if you settle the case before the at-fault driver responds. It can be higher if you receive a formal answer to your complaint or if a jury verdict is reached in trial.
Imagine that the at-fault driver responded to your demand letter and you settled your case for $60,000. The attorney can receive the average 1/3 of this at $20,000; but if the case was resolved with a jury verdict and your state allows 40% of recovery with an answered complaint, then your attorney can receive $24,000. Make sure that you fully understand the contingency fee that applies in your case.
Expenses / Fees
You may be responsible for litigation expenses like upfront court fees, depending on your attorney and the legal services contract. Some fees and expenses you’ll have to think about include the following:
- Court filing fees
- Cost of serving summonses and subpoenas
- Costs of obtaining medical records and police reports
- Court reporter fees
- Expert witness fees
In most cases, your personal injury attorney might require these payments to be made when they become due in your case, and your case will not proceed until you’ve paid them. In some cases, the personal injury attorney will cover these expenses and deduct them from your final judgment or settlement. Typically this is something that larger firms will do.
If you settle your case for $60,000, your contract says that your fees and expenses will come out of your settlement, and those fees amount to about $5,000, then your attorney will collect his percentage in addition to the $5,000 at the end of the settlement or final judgment. Thus, if your attorney’s fees come to $20,000, $25,000 is what he or she will receive to cover their own fees and the court expenses that they’ve already covered. This would make your own final recovery $35,000.
Additional Fee Agreements
Some cases do not have a pure contingency fee agreement. You lawyer may want to receive a retainer at the beginning of the case, then collect the contingency fee at the end. If you work with this kind of agreement, then the amount that you’ve paid as a retainer will be subtracted from the contingency fee that you owe the attorney when you receive a settlement or judgment. Thus, if you pay your attorney $3,000 as a retainer and agree to a 33% contingency fee, then your settlement of $60,000 gives the attorney $20,000. Yes, the $3,000 retainer will be deducted from this so that your attorney will receive $17,000 at the end of the case.
Typically flat fee agreements are only practical for uncomplicated cases. For example, if the attorney will have to do little more than draft or respond to a demand letter, he or she may charge a simple fee of $300 to $1,000 for these services.
Should You Hire A Car Accident Lawyer?
The value of hiring a car accident lawyer is greater in cases where significant injuries occurred. A minor fender bender without injuries does not necessarily require the assistance of a lawyer. You should be able to get an acceptable settlement by negotiating for yourself. When the settlement is simple and guaranteed, there’s no need to pay a lawyer for this service.
When there are injuries and medical treatment required, the value of your settlement significantly increases, so an insurance adjuster will try to minimize the damages to give you a lower settlement. This is where a car accident lawyer can make all the difference. You are likely to recover more than three times what you would on your own by working with an attorney.
The threat of a lawsuit is often enough to pressure an insurance company into offering a fair settlement, and an attorney will be able to effectively negotiate your damages.