When you start looking for a personal injury lawyer, one of the first questions you’re likely to have is “How much will this cost me?” You may already be facing financial difficulties, and lawyers’ fees can be very expensive. Can you even afford to get the representation you need to go up against the insurance companies?
As you start researching personal injury attorneys in Chicago, IL, you may start running across references to contingency fees. So what is this fee structure and how does it work? Read on to learn more about how contingency fees work in personal injury cases.
What Is a Contingency Fee?
When most of us think of lawyers’ fees, our minds go to retainers and hourly charges. But contingency fees aren’t charged based on how long the lawyer spends working on the case. Instead, they depend on how much money the lawyer recovers for their client.
Contingency fees are calculated as a percentage of the settlement a lawyer recovers in a client’s case. Since the settlement amount obviously can’t be determined before the case is concluded, the client doesn’t have to pay until they get the money they’re entitled to from the case.
Benefits for Clients
Contingency fees are better for clients in a variety of ways, especially when it comes to personal injury cases.
No Up-Front Costs
Oftentimes after an accident, victims find themselves in a dire financial situation. Even if you have health insurance, your medical bills can start piling up in a hurry after a serious injury. And many injury victims are unable to work while they recover (some can never return to work again), limiting their ability to bring in income to pay their medical expenses.
When you’re already drowning financially, hiring a lawyer to help you fight for fair compensation can seem impossible. But contingency fees mean that accident victims don’t have to pay up-front fees. They can get justice in their case without going bankrupt in the process.
Fees Don’t Exceed Your Settlement
One of the other problems with traditional lawyers’ fees in personal injury cases is that those fees can add up fast. In a case where you don’t recover a huge settlement, lawyers’ fees could pretty quickly outstrip all the money you got in compensation. You could win your case and still wind up in a worse financial situation than you were to begin with.
But with contingency fees, you can be sure that your lawyers’ fees won’t exceed the amount of money you get in your settlement. In fact, some personal injury lawyers offer a net recovery guarantee that ensures you’ll never pay more for your case than you get in your settlement. At the end of the day, you can be confident that you won’t suffer financially for seeking justice in your case.
More Incentive to Get a Maximum Recovery
Another powerful benefit of contingency fees is that it gives your lawyer a strong incentive to recover as much money in your case as they can. Of course, a good lawyer should always work to get you the best result possible. But having a personal stake in the outcome of your case can provide an extra bit of motivation.
The more money your lawyer recovers in your case, the more they’ll get as a contingency fee. This can help you sleep a little easier, knowing that your lawyer is just as invested in winning your case as you are.
How Much Are Contingency Fees?
The golden question with contingency fees is exactly how much of your settlement your lawyer will get. Unfortunately, there’s no one simple answer to this question. Contingency fee amounts can range from 25 to 50 percent, depending on how your particular case gets settled.
Demand Letters Only
In some cases, a personal injury lawyer can get a fair settlement in a case just by sending a well-composed demand letter. These cases settle fairly quickly and don’t require the lawyer to do a ton of legwork. In these cases, your lawyer may only take 25 percent of the settlement they recover for you.
Negotiations Out of Court
The vast majority of personal injury cases wind up getting settled before they ever go to trial. Even if an insurance company denies an initial demand letter settlement, your lawyer may still be able to negotiate a settlement with them outside of court. If your lawyer settles your case without going to trial, they may take 30 to 35 percent of your settlement as their contingency fee.
If an insurance company refuses to offer a fair compensation package in negotiations, your case may have to go to trial. As you might imagine, preparing for and conducting a trial takes a lot more time and work than writing a demand letter. In these cases, your lawyer may take 40 to 50 percent of the money they recover in your case.
What Happens If You Lose?
All of the contingency fee structures we’ve discussed have assumed that your lawyer will win your case. So what happens if you lose?
Often, personal injury lawyers will have a no-win, no-fee guarantee that states that you only pay the contingency fee if they recover money in your case. If they aren’t able to get you a settlement, you likely won’t have to pay any attorney’s fees.
That being said, attorney’s fees aren’t the only expenses in a case. Make sure you check with your lawyer about what fees, if any, you’ll have to pay if they can’t get any money for you.
Get the Representation You Can Afford
Hiring a personal injury lawyer can make all the difference when it comes to getting a fair settlement in your personal injury case. Contingency fee structures can make it possible for you to get the compensation you deserve without going even further into debt. Often, lawyers will take between 25 and 50 percent of your settlement as their fee, depending on how much work they have to do on the case.
When you need a lawyer who will fight for your case like it was their own, call Zayed Law Offices Personal Injury Attorneys at (312) 726-1616. Schedule a free consultation contact us to discuss your case.