My dad was hit by a car while riding his bicycle and was recently given a large settlement from the driver’s insurance company through his bodily injury policy. The insurance company has given us two options. Option A is we get all the settlement money and it’s up to us to pay the medical bills ourselves and we can then keep the remaining money. Option B is the insurance company pays the medical bills and gives us the remaining money. What do you think would be the best option? What would the pros and cons be? (We intend to pay all the medical bills)
What should we do with accident settlement money?
byu/prettymfale inInsurance
Posted by prettymfale
11 Comments
Do you trust yourself to pay the bills if you get thousands of dollars paid at once?
Does he have sustaining injuries? Some injuries can take months to really notice long term effects, and long-term physical therapy and other care can add up quickly in costs.
If he’s not very injured and you don’t expect more medical bills, option A might be the better route depending on the amount of the settlement and the cost of the bills. If he is still undergoing medical treatment and/or expects continuing medical bills, I’d stick with option B. You never know how high those bills could get.
Not nearly enough info. What state? Do you feel fully compensated for all losses or are policy limits being tendered? If you’re completely compensated and satisfied, is there really a difference between the two options?
If it were me I would take the full amount and negotiate the bills down with the providers.
I am a BI adjuster. I would ask if the insurance company is getting the bills lowered through the providers. If so, I would have them pay the med bills. If they have sent a release to your father, read every word.
Are you represented by an attorney in this matter? If so – and I hope so – this is something to discuss with your attorney. Medical liens can be substantial, but they are also *negotiable*. Unless you know what you’re doing here, you may not maximize your net settlement.
Option A. The reasoning is the medical bills can be negotiated. Let’s say you have 100k of bills, offer half that and most of the time the hospital will accept. This is what the insurance company will do if you have them resolve the bills.
This is the same thing attorneys do as well to trick you into thinking you’re getting more money.
“It’s your money; use it when you need it!”
Question? Are they paying the policy maximum? Is so his injuries may be worth more than the settlement. Does your father carry under insured motorist on an auto policy or live with someone who does. He may be entitled to more from another source.
Nope. He should be getting his medical bills paid for the rest of his life due to the injury and pain and suffering. I hope your dad has a lawyer.
Do you know how to negotiate medical bills? Do you have access to an HSA to stuff money into and therefore get to use pre tax dollars to pay down the bills? Have you asked how much for the bills they’ll give you? Often insurance carriers will give you a reduced amount towards your medical bills, and you have to hope the provider will accept that (or less). Don’t get yourself in too deep if this isn’t your expertise.