Can a Closed Car Insurance Claim Be Reopened?
While reopening a closed claim isn’t impossible, it’s often an uphill battle. Our team at Rainwater, Holt & Sexton is here to walk through the details and help you make an informed decision.
Life after a car accident can be overwhelming. You’ve dealt with injuries, vehicle repairs, and the stress of navigating insurance claims. Perhaps you’ve even settled your case, thinking it was finally over. But what if you discover that your settlement doesn’t cover all your expenses? Or worse, what if new injuries surface after closing your claim?
While it is difficult to reopen a closed insurance claim, your chances of success are greater when you hire an experienced Arkansas car accident lawyer to help you through the process. Here’s what you need to know.
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What Is a Closed Car Insurance Claim?
Before we explore reopening claims, let’s clarify what it means for a claim to be “closed.”
Insurance companies typically consider a claim closed when:
- You’ve signed a settlement agreement
- The insurer has paid out the agreed-upon amount
- You’ve stopped actively pursuing the claim
- A specified time limit (often set by state law) has passed
In Arkansas, the statute of limitations for car accident claims is generally three years. Once this window closes, your ability to pursue a claim becomes severely limited. There are exceptions to the statute of limitations in Arkansas. So, even if you believe your case is closed, it might not be. A skilled Arkansas car accident attorney can examine your case and help identify your legal options.
Is Closing a Car Accident Claim Final?
Closing a claim isn’t just a formality. It has real consequences. Once closed, you’ll likely face significant hurdles if you try to seek additional compensation or negotiate further with the insurance company.
Why? Because insurers view closed claims as resolved matters. They’ve allocated funds, adjusted their books, and moved on to other cases. Reopening a claim disrupts their process and potentially costs them more money—something they’re understandably reluctant to do.
The Binding Nature of Settlement Agreements
Here’s where things get tricky: When you settle a claim, you’re often required to sign a release of liability. This legal document says you’re giving up your right to pursue further action related to the accident.
These agreements are designed to protect insurance companies from future claims. They’re typically ironclad, making it extremely difficult to seek additional compensation once you’ve signed on the dotted line.
This is why it’s crucial to fully understand the terms of any accident or injury settlement before agreeing to it. Don’t let the promise of a quick payout cloud your judgment—you could be signing away your rights to fair compensation. Instead, discuss your case with an experienced car accident attorney to ensure that you get all the compensation you need the first time, which will reduce the likelihood of needing to reopen a car accident claim.
When Can a Closed Claim Be Reopened?
While rare, there are situations where reopening a closed claim might be possible with the right legal team on your side. Here are some of the more common scenarios that might prompt a closed claim to get reopened:
Sometimes, the full extent of your injuries or vehicle damage isn’t immediately apparent. For example, you might develop chronic pain weeks after the accident, or hidden structural damage to your car could surface months later.
In these cases, you might have grounds to request that your claim be reopened. However, you’ll need to prove that these new damages are directly related to the original accident and weren’t reasonably discoverable at the time of settlement.
If you can demonstrate that the insurance company acted in bad faith during the claims process, you might have a case for reopening your claim. Bad faith practices could include:
- Deliberately misinterpreting policy language
- Unreasonably delaying claim processing
- Failing to conduct a proper investigation
- Knowingly undervaluing your claim
Proving bad faith can be challenging, but it’s not impossible with strong legal support.
In some accidents, multiple parties share responsibility. If you’ve settled with one party but later discover that another bears partial fault, you can pursue a claim against the newly identified party, even if your original claim is closed.
If you can prove that the settlement was based on fraudulent information or misrepresentation by the insurance company or another party, you may have grounds to reopen your claim. This could include situations where:
- The insurer concealed crucial information
- Another party lied about the circumstances of the accident
- Evidence was tampered with or falsified
In rare cases, both you and the insurance company might have made a mutual mistake regarding a material fact in the case. If this mistake significantly influenced the settlement terms, you might be able to argue for reopening the claim.
For example, if both parties based the settlement on a medical report that later turned out to be incorrect due to a lab error, this could be grounds for reopening the claim
While uncommon, there are instances where policyholders have successfully reopened claims by demonstrating that their attorney provided ineffective assistance during the settlement process. This could involve situations where your original Arkansas car accident lawyer:
- Failed to investigate the claim properly
- Neglected to inform the client of important rights or options
- Made serious errors in legal strategy
It’s important to note that the bar for proving ineffective assistance is quite high, and these cases are rarely successful without strong evidence.
Injured in a Car Accident?
Protecting Your Rights Before Settling an Auto Accident Claim
Given the challenges of reopening a closed claim, protecting your rights from the outset is crucial. Here are some key steps to take:
Assess the Full Extent of Damages
Don’t rush to settle. Take the time to evaluate all your damages, including:
- Current and future medical bills
- Lost wages and earning capacity
- Property damage
- Pain and suffering
- Long-term care needs
Consider working with medical experts to project future healthcare costs, especially for serious car accident injuries. Remember, once you settle, it is very difficult to return for more—so make sure you account for everything.
Resist Pressure from Insurance Companies
Insurance adjusters often push for quick settlements. They might tell you that their offer is “time-sensitive” or that you’ll lose out if you don’t act fast. Don’t fall for these tactics.
You have the right to take your time, review all documentation, and consult with professionals before deciding. If you feel pressured, that’s a red flag, and a sign that you might benefit from legal representation.
What to Do if You Believe Your Settled Claim Should Be Reopened
If you’ve already settled but believe you have grounds to reopen your claim, here’s what you should do:
Start by collecting any new evidence that supports your case. This might include:
- Additional medical records
- New diagnoses related to the accident
- Expert opinions on long-term prognosis
- Updated repair estimates for your vehicle
- Witness statements you didn’t have before
The stronger your evidence, the better your chances of successfully reopening your claim.
Write to your insurance company explaining why you believe your claim should be reopened. Be clear and concise, and stick to the facts. Avoid emotional language or accusations; focus on presenting your case professionally.
Be prepared for resistance. Insurance companies are rarely eager to reopen closed claims. They might:
- Deny your request outright
- Ask for more information
- Offer a small additional settlement to avoid reopening the claim
Whatever their response, remain calm and document all communications.
This is where having an experienced car accident attorney becomes invaluable. A skilled lawyer can:
- Assess the strength of your case
- Advise you on the best course of action
- Handle communications with the insurance company
- Negotiate on your behalf
- Represent you in court if necessary
Remember, insurance companies have teams of lawyers protecting their interests. Shouldn’t you have someone in your corner, too?
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