How To Write a Settlement Demand Letter

Preparations: Investigating and Gathering Evidence

Before you even begin drafting a demand letter, you must carefully prepare your claim. 

Initial Consultation With a Lawyer

Not every claim requires a lawyer. If yours is significant enough to require a lawyer, or if you are simply not sure, start with a free initial consultation. This will help you and the lawyer get to know each other and help you determine whether you need representation.

Perform a Preliminary Investigation

In a preliminary investigation, you or your lawyer (if you have one) assemble evidence to learn more about your claim. Evidence also serves as ammunition for settlement negotiations. 

Gather evidence such as:

• Photographs of the scene of the accident, any injuries, and any property damage
• A list of eyewitnesses
• Medical records
• An accident report, if one exists
• Analysis and conclusions from expert witnesses, if appropriate

Collect any other available evidence.

Identify the Liable Party

Who will pay your claim? Even if you have already identified the appropriate defendant, it is likely the insurance company, not the defendant, who will pay your claim. It is this party with whom you must negotiate.

Drafting the Settlement Demand Letter

In a settlement demand letter, you state your claim for compensation. Remember, a claim is different from a lawsuit. Yes, a claim can mature into a lawsuit. Most likely, however, it will mature into a settlement.

Contents of a Demand Letter

Following is a rough outline of the contents that should be included in a settlement demand letter: 

• Write out a paragraph or two describing the accident or incident that injured you. Don’t give too many details.
• Explain why the defendant (the insured) is liable for the claim. For example, the insured was following you too closely on the road and could not avoid a collision. Alternatively, the insured might be vicariously liable as the employer of an on-duty employee who acted negligently.
• Briefly describe all injuries and property damage that you suffered as a result of the accident.
• Describe your losses in terms of damages. This includes medical expenses, lost earnings, pain and suffering, etc. At this point, you don’t have to reduce everything to a dollar amount, especially intangible losses such as pain and suffering.
• Demand compensation. You might not need to ask for a specific dollar amount. Depending on your legal strategy, you might want to wait for the insurance company to make the first offer. 
• Don’t set a specific deadline for a response unless the statute of limitations deadline is looming.

Include any useful supporting documentation, such as copies of medical bills. A word of warning: Never rely on a demand letter sample that you find on the Internet.

Stylistic Considerations When Drafting a Demand Letter

Observe the following stylistic considerations:

• Be concise. If you aren’t, the adjuster probably won’t read most of your letter. If you must draft a long letter (for an unusually complex claim), add a summary on Page 1. 
• Be organized. Draft an outline first, and write your letter based on the outline. 
• Avoid bluster. Insurance adjusters have heard it all before, and an overly threatening tone only weakens your claim.
• Read your letter from the point of view of an opposing lawyer who is looking to use your own words against you. Take out or modify any wording that the opposing party could use against you.

After you finish your letter, have a lawyer review it. 

Ask a Los Angeles Personal Injury Lawyer To Draft the Settlement Demand Letter for You

It’s a good idea to ask a Los Angeles personal injury attorney to review your demand letter before you send it. It’s a better idea to have the lawyer draft the letter for you. Additionally, consider asking your lawyer to handle the ensuing settlement negotiations on your behalf.