How contingency fees work in car accident injury cases?



As far as contingency fee agreements are concerned, there is nothing like a ‘standard percentage’. Normally, a car accident lawyer will charge at least one-third of the total compensation amount that is awarded to the plaintiff in car accidents.  To learn more about the contingency fee, you should read this article. 

Before discussing how a contingent fee works, the readers should have an idea on what is contingency fee. A contingent fee is a fee that is collected by attorneys only when they represent an aggrieved party for settling their claims. In simple terms, the attorney will get a fee under the following conditions:

·         When the court provides a judgment in favor of the plaintiff involved in a car accident,
·         When the car accident lawyer can settle the claims of the plaintiff from the insurance company of the alleged driver.

So, the lawyers’ payment is conditional/contingent upon the upshot of the case.
How costs are handled?
The main idea behind the contingency fee basis is that you will pay the attorney only if the case is settled. Technically speaking, it is not always true. The agreement has to be read upon to check if you can bear the costs of filing the case, photocopying, and other costs that are associated with the case. 

In most of the contingency agreements, the lawyer will take up the cost as they keep increasing. However, if the plaintiff earns settlement compensation, the cost which was absorbed in the initial stage will get subtracted from the total compensation amount that was awarded. You just need to ensure that you do not pay any cost for an unsuccessful case. 

Contingency fee contracts are applicable for the applicants’ only\
Contingency fee basis in car injury cases is applicable only when an attorney represents a car accident victim. In other words, this contract is available to the applicants who are filing an accident lawsuit and seeking reimbursement for his damages from the insurance company of the alleged party. 

If you are the alleged party, then your insurance company has to pay on your behalf to the attorneys for defending you in a lawsuit. This is known as the ‘duty to defend’ on part of the defendant’s insurance company. However, this is applicable only when the party at-fault has car insurance. 

But in case if you do not have car insurance, or if the maximum value of the coverage has surpassed, and an insurance company has no responsibility to defend your lawsuit, you need to hire an attorney on an hourly basis. 

How much is the contingency fee in a car accident case?
As mentioned above, there is no standard percentage of fees in car accident cases. However, in a general sense, 33% of the total compensation awarded to the plaintiff is considered as the standard fee. However, this will differ from one state to the other.  In many car accident cases, this percentage is calculated on a ‘sliding scale’ basis. For example,

·         If the case is settled before filing a lawsuit, the attorney may charge 25% of the total compensation amount
·         If the case is settled before the trial, the attorney may charge 33% of the total compensation amount
·         If the case goes to trial, the attorney may charge 40%

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