If you’ve been in a collision and it was someone else’s fault, odds are very good that you will hear from the at-fault driver’s insurance company as soon as possible. It’s a tactic that is happening more and more in Arizona. This is done for a variety of reasons: (1) the insurance company would like to catch you off guard and when vulnerable following the collision; (2) most people are in shock following a collision and haven’t had time to determine the full extent of their injuries; and (3) the insurance company would like to get to you before you have had a chance to speak with a lawyer.

It’s very common for the insurance company to call you the same day and in some cases shortly after the collision. The adjuster will act friendly and attempt to build trust. Most people involved in a collision are vulnerable and feeling awful, both mentally and physically. It’s comforting to have an insurance company call you so quickly. Some will even say “we are admitting fault for the collision.”

But then, inevitably, you will be asked for a “recorded statement.” The adjuster will tell you that it is standard practice for anyone making a claim even if fault is admitted. Most people involved in a collision think it is an opportunity to tell “my side of the story to help my claim.” It’s NOT. I do NOT allow my clients to give recorded statements. And, I have never seen a recorded statement “help” a claim although I have seen plenty that hurt. If you are asked to give a recorded statement, you should politely decline.

Next, the insurance adjuster is going to request that you sign a medical authorization so that the insurance company can get your doctors paid. Again, this is a tactic. It will be a blanket authorization. It will be unlimited in time and scope. Do you really want to give an authorization to an insurance company so that it can obtain your medical records from any and every medical provider that you have ever seen in your life? I do NOT allow my clients to sign authorizations for the insurance company absent a confidentiality agreement or court order limiting the authorization to those records relevant to the injuries sustained in the collision. Again, if you are asked to sign blanket authorizations, you should politely decline.

This brings up what I consider the insurance company’s most egregious tactic. The insurance company, immediately following a collision, will offer a quick, nominal settlement in return for a signed or verbal release of your claim. Think about it – the insurance company offers you a quick $1,000 to $3,000 simply to walk away before you’ve even seen a doctor or received any treatment. Tempting? It’s very tempting and the insurance company knows that it is taking advantage of someone in a vulnerable position. Someone who has just been in a traumatic event can still be in shock and shouldn’t be making legal decisions like signing away their rights. Remember that most people involved in a collision usually do not realize the full extent of their injuries for days or longer.

Several years ago, before this quick settlement tactic fully developed, State Farm Insurance Company had a document called, “The Do’s And Don’ts Of A Minor Car Accident.” This document stated: “Don’t assume there aren’t injuries . . . Even low-impact collisions can cause injuries, some not appearing until days after the accident.” Of course, this great advice from State Farm disappeared about five years ago for some reason.

I am seeing a lot of this quick-hit settlement practice from most insurance companies here in Arizona. I’ll give you two examples of cases I have dealt with recently. The first case is the typical situation. Young man involved in a rear-end collision on Friday. He clearly had no fault for being rear-ended. He had never been in a collision before and had never made an insurance claim of any kind before. Geico called him soon after the collision. According to him, it was a nice adjuster who truly seemed to be concerned about his well-being. Geico’s adjuster spoke to him in length on the phone. She persuaded him to give a recorded statement. At the time she was speaking to him, he said he was experiencing pain between 6 to 8 on a scale of 1 to 10 with 10 being the most severe pain he had ever felt. He told her that he would follow up with his doctor the following week.

Soon thereafter, Geico’s adjuster ended the recorded statement. However, she did not end the conversation. In fact, this young man did not realize that she had stopped recording the phone call. The Geico adjuster indicated that she had run his expected treatment through her computer and the treatment would cost about $750.00. According the young man, the Geico adjuster then offered the $750.00 as an advance payment towards his future medical bills. The problem is that the Geico adjuster told him that he would need to give his permission for getting paid the “advance.” So, Geico turned the recorder back on and verbally stated a full and final release of ALL claims. The young man who had just been in a collision, knew nothing about insurance claims, and had no idea what was going on, simply affirmed the verbal, recorded release for $750.00.

The next day the young man could barely move because his injuries were so severe. His medical bills were going to be several thousand dollars. When he contacted Geico to pay the additional bills, Geico basically told him “so sad, too bad” because you released everything for $750.00.

Can an oral contract to release be valid? Sure. Is this “release” an adhesion contact? Yes. Is Geico’s conduct in inducing the settlement fraudulent? Probably, but it is difficult to prove because Geico did not record the entire conversation and argues that it honestly handled the young man’s personal injury claim. And, this is now no longer just a personal injury (tort) case. It is a contract case between Geico and the young man. In contact cases, attorneys’ fees can be awarded. Geico litigated a similar case in Texas a couple years ago. Not only did the Texas court uphold the release, it awarded Geico $10,000 for attorneys’ fees. So, there is an obvious risk when contesting these despicable quick-hit settlement releases.

My second case is much more unusual and also has a much happier ending. It involved another collision. Although my client had never been in a collision before and had never made a claim before, he was older and more experienced. The at-fault carrier (Allstate) called him the day of the collision. He refused to give a recorded statement. Allstate did not give up. Allstate eventually offered $1,600 to settle the claim. There was back pain, but it didn’t seem too bad at the time. My client was tempted, but discussed it with his wife. Thankfully, they decided to wait. No settlement check cashed. No release signed.

During the next few days, the back pain grew worse. It became excruciating. His legs started to go numb. His family doctor sent him to get an MRI. The MRI showed a herniation because of the collision. It was severe and required neurosurgery. He suffered permanent disability. Allstate unsuccessfully tried to get a quick-hit settlement for $1,600 on a claim that was eventually valued at over $600,000. Can you imagine how devastating it would have been to his family had he accepted Allstate’s quick-hit settlement offer?

Insurance companies are not on your side. Insurance companies are not good neighbors. Insurance companies don’t really care about you. The opposing insurance adjusters believe it is their job to settle claims as quickly and for as little as possible. No matter how nice or kind they sound, their loyalty is to their insurance employer not the injury victim. There is nothing fair about it. Please, even if you do not hire an attorney, do not give recorded statements to the opposing insurance company and absolutely do not sign personal injury releases without at least being checked by your family doctor. Of course, the best practice is to hire an attorney to look out for your interest and with the goal of protecting your rights.