top of page
  • Writer's pictureRobert Schuerger

How Are Personal Injury Settlements Paid Out in Texas? | A Legal Guide to Payouts!

With the medical bills and future medical expenses piling up, an injured victim's stress levels can reach an all-time high, further adversely affecting their life. They may want to know when they might receive the payment and how the insurance company will disburse the settlement amount so that they can plan ahead.

Schuerger Shunnarah Trial Attorneys have recovered millions of dollars for their injured clients, and they have extensive experience in negotiating fair personal injury settlements.

Those who have suffered injuries in Dallas, Texas, should reach out to them to discuss their case and learn more about their rights.

How Are Personal Injury Settlements Paid Out in Texas?

How Are Personal Injury Settlements Paid Out in Texas?

There are two ways the defendants can pay out personal injury settlements to the affected parties in Texas, and these are as follows:

Lump-sum Payment

A lump sum payment involves the disbursement of the entire settlement funds in a single transaction. The affected party does not have to wait for multiple payments, as under this agreement, the defendant (at-fault party) must process all of the compensatory damages in one go.

If the affected party agrees to receive a lump-sum payment, they must notify the defendant and their insurance company. Under Texas law, the at-fault party or their insurer must disburse the settlement funds within five business days.

The benefit of a lump-sum payment is that the claimant or affected party can pay off their debts and other expenses, alleviating the financial burden immediately.

However, a major drawback to receiving a single payment is that some people might feel tempted to spend the money rather than save it for a rainy day.

Structured Payment

During the negotiations phase of a personal injury claim or lawsuit, all the parties involved may decide on a structured settlement. This involves multiple incremental payments according to the frequency negotiated prior to the signing of the agreement. Contact Schuerger Shunnarah Trial Attorneys for questions such as What is a personal injury structured settlement?

There could also be a financial arrangement where the defendant pays out an initial lump sum payment, with the remainder spread across multiple payment installments. This allows the injured victim to pay off their major expenses or bills and have a steady flow of income.

In most personal injury cases involving children, the arrangement is slightly different, whereby the child receives installments until they reach the age of 18 before receiving the remaining settlement amount as a lump sum payment.

How Does the Settlement Money Get Distributed in a Personal Injury Case?

When both parties agree on the settlement amount, the at-fault party or their insurance company will transfer the payment to the law firm's trust account. The personal injury lawyer representing the claimant or affected party will handle the disbursement by first paying off the creditors.

Here are a few parties that may receive a payment from the settlement funds:

Medical Providers and Creditors

In cases where the medical providers offer treatment on a lien basis, the personal injury attorney will settle the debt and clear all outstanding medical bills.

Often, the medical provider offers its services on a lien basis and receives a portion of the settlement funds according to the agreement signed prior to the treatment.

An experienced personal injury lawyer can help negotiate the lien and reduce the outstanding charges to ensure that their client receives maximum settlement funds for their injuries. They can also answer questions like Is a personal injury settlement considered income?

Legal Fees

Most Texas personal injury lawyers work on a contingency fee basis, meaning they don't charge any upfront payment but take a portion of the settlement amount if they win the personal injury lawsuit or successfully handle the accident claim.

Once they've paid all the creditors, the personal injury attorney will take a percentage of the settlement amount before disbursing the final amount to their client.

How Long Does It Take to Receive the Settlement Amount?

The amount of time it takes to disburse the settlement payment in a personal injury case depends on the nature of the claim or lawsuit and the state laws.

In Texas, insurance companies must investigate a personal injury claim and notify the claimant about its decision (whether they accept or reject the claim) within 15 days. However, if it has a valid reason, the law may allow an extension of up to 45 days.

After both parties agree on a fair settlement, the insurer has the legal obligation to process the personal injury claim within five business days.

What Is the Average Car Accident Settlement Amount in Texas?

What Is the Average Car Accident Settlement Amount in Texas?

According to the Jury Verdict Research, the average verdict in a personal injury lawsuit in the Lone Star state is around $826,892.

Although the average verdict is quite high, it shouldn't be a determinant in calculating the compensation in a case. This is because these are only verdicts, and most personal injury cases are settled outside of courts.

Another key thing to remember is that Texas has had exorbitantly high verdicts in the past few years, which is why the average verdict amount stands at $826,892 compared to the median award, which is only $12,281.

When it comes to the average car accident settlement in Texas, the Insurance Information Institute published a report in 2022 that showed that the average settlement amount increased from $15,441 in 2013 to $22,734 in 2021.

There are several factors that the injured victims must take into consideration when calculating the value of their car accident claims, some of which include the following:

  • The severity of the injuries

  • The nature of the injuries sustained

  • Type of evidence gathered

  • Insurance coverage

  • Modified comparative negligence rule

It's important for the injured victims to reach out to an experienced Texas personal injury lawyer for legal assistance. An attorney can help the victim calculate the compensatory damages incurred, build a strong case, and pursue the compensation they deserve.

Schuerger Shunnarah Trial Attorneys Can Provide Injured Victims with an Accurate Estimate!

Before disbursing payouts according to the settlement agreement, there is a long legal process that the injured victims must follow, and this includes calculating the value of a claim or lawsuit, pursuing civil action, and negotiating a fair settlement with the insurance company.

Those who have suffered injuries in Dallas, Texas, should call for a free consultation with Schuerger Shunnarah Trial Attorneys. They can help protect the injured victims rights, build a strong personal injury case, and go to war against the insurer to get the compensation they deserve.


bottom of page