Personal injury litigation can be a long and expensive process. Most personal injury claims settle before trial commences. Early settlement is beneficial to the injured plaintiff for a number of reasons. One of the reasons is that the costs of trial can be avoided if settlement occurs early on in litigation. It’s important to consult with a personal injury lawyer as soon as possible to understand your rights.

The legal costs of a personal injury action going to trial can be significant. If the plaintiff loses at trial, or if the amount the court orders at trial is less than the settlement offer previously made by the defendant to the plaintiff, the plaintiff is liable to pay costs to the defendant. The plaintiff may be required to pay tens or hundreds of thousands of dollars in costs after an unsuccessful trial. The result could be financial ruin.

In addition, insurance companies may capitalize on the principle of adverse costs. Insurance companies might make lower settlement offers if they are aware that the plaintiff cannot afford to go to trial.

An insurance policy that offers legal cost protection is recommended for plaintiffs in personal injury actions. If a personal injury action goes to trial and the plaintiff loses, legal cost protection insurance will cover the excess costs. A legal cost protection insurance policy is best purchased at the outset of a personal injury action in order to yield the lowest premiums and gain the most leverage with the defendant and their insurers.

Insurance companies that offer legal cost protection do not require payment from the plaintiff up front. Insurance premiums are deducted from the plaintiff’s settlement. In the event that the plaintiff loses at trial, the insurer will pay their costs and will not charge an extra premium.