Almost immediately after being involved in an auto accident that is not your fault you immediately start to see your finances impacted.
If you go to the emergency room or urgent care on the date of the wreck, you immediately incur costs in the form of a co-pay, even if you have health insurance. From there, you might start losing income from missing work because you have to take off to go to the doctor, or maybe because you are just physically unable to work.
As your injury treatment progresses, you start to miss more and more time from work and incur increasing medical bills. Although you believe these bills should be paid by the at fault party’s insurance company, the truth is they do not “pay as you go” for your bills.
The only time the adverse party’s insurance company is going to pay you for your medical bills, lost wages, etc.. is when you settle your case with them. This could take months, and even years, depending on the severity of your injury and the amount of insurance coverage.
So how do you survive in the interim? Below are a list of possible ways you can come into funds before settling your injury claim:
1. Medical Payments Coverage on your auto policy: This insurance can be purchased through your auto policy. It is essentially health insurance for a car accident, and can enable you to be compensated for your medical expenses as you go up to the amount of your coverage.
2. Cash advances from a funding company: This is certainly not the preferred solution. Essentially there are funding companies that realize your case is likely to yield a recovery in the long term so they agree to give you money now in exchange for full payment at (high) interest later. It will cost you in the end to use this option, but it might be preferred in order to keep your claim active for a longer period of time.
3. Treating with your medical providers on a lien: This is an option whether you have health insurance or not. Providers will sometimes agree to treat you with no up front money, in order to get full payment later when your case settles. They do this because the amount they get in the end exceeds what they would otherwise get by billing through health insurance. Sometimes people without health insurance choose this to avoid co-pays. While this does not directly put money into your pocket, it does indirectly yield cash to you by not forcing you to pay providers for treatment as you go.
4. Settling Your Case with the primary liability insurance policy limits pursuant to a Limited Liability Release. There is a scenario where you can collect against the at fault party’s full bodily injury insurance coverage while not compromising your claim in full. This is done through a limited liability release. The only time however this is possible is when your claim is worth more than the full amount of liability coverage AND you have some additional uninsured motorist coverage that can offer you benefits as well.
If none of those are available, or all have been exhausted, then you are left with choosing between settling your case early or trying to make due with limited cash in order to preserve your claim. The dilemma is a lot of times the insurance company will not offer full value to your case until you get close to trial (if ever), so you will potentially be accepting less than full value to settle a case when you are desperate for cash but the case is not yet ready for trial.
By Peter Bricks