Can You Sue Someone After Settling With Their Insurance?

When you are involved in an accident or experience property damages or injury due to someone else’s negligence, dealing with the insurance company is inevitable. Those involved in the accident often use the at-fault driver’s insurance policy to cover their losses. However, sometimes, the at-fault driver’s insurance does not cover the complete amount you are owed, leaving you to foot the rest of the bill. In this case, many often wonder if they can sue the at-fault driver, even after their insurance has settled their claim. Let’s take a closer look at if you can sue someone after settling with their insurance and how to get the compensation you deserve. 

Understanding Settlements with Insurance Companies

It’s important to know how insurance companies operate and how settlements work for a potential plaintiff. When a claim is filed with the insurance company, you are seeking damages from the at-fault party’s negligence or reckless actions. The insurance company will then investigate the claim, negotiate with the individual filing the claim, and eventually offer a settlement amount.

When a settlement is reached, it is an agreement between the individual who filed the claim and the insurance company, where the individual agrees to accept a certain amount of money or settlement amount to compensate for the damages and injuries caused by the accident. A release form is then signed by the claimant, which, in most cases, waives their right to pursue further legal action.working with insurance adjusters

Can You Sue After Settling with Insurance?

So, can you sue someone after settling with their insurance? It depends. There are many factors that come into play here, including local laws and jurisdictions. Let’s take a closer look at this in more detail below:

Terms of the Settlement

The terms of the settlement agreement play a significant role in determining whether or not you can sue the at-fault party after a settlement is reached. In most cases, a release clause prevents any further legal action being taken against the insured party. In short, if you’ve signed a release form, you likely waived your right to take further legal action against the responsible party.

However, it is also important to mention that not all settlement agreements include a release clause. Some release clauses could be broad and comprehensive, while others could be more limited in scope. It is important to review the terms of the settlement agreement carefully before signing anything. 


Scope of the Settlement

The scope of the settlement refers to the extent that the settlement covers your damages. In some cases, the settlement offered by the insurance company might not fully compensate you for your losses, such as medical expenses, property damage, lost wages, and pain and suffering. If you believe that the compensation is not sufficient to cover your damages, you could pursue further compensation through legal action against the responsible party. 

This is why it is important to carefully review your settlement offer prior to signing the release form, as you might not be able to pursue additional compensation once the release form is signed. 

Legal Rights and Jurisdiction

The jurisdiction you are in also has a significant impact on your overall ability to sue another party after settling. Laws governing settlement agreements vary by state, therefore, it is crucial to know the law in your area.

Depending on where you are located, there might be exceptions or limitations on release clauses, especially if the settlement was either fraudulent, the individual was coerced, or even misrepresented. It’s also important to recognize the statute of limitations in a personal injury claim, as it is difficult to recover compensation after the statute expires. Consulting with an attorney who is familiar with the rules and regulations in your jurisdiction, can provide you with valuable insight into your rights and options to pursue further.

insurance company negotiations

New Evidence or Circumstances

Although rare, you might also find new evidence after reaching a settlement with the at-fault party’s insurance company that might warrant opening the case back up. For example, new medical evidence is presented that explains your injuries were much more serious than was thought initially, and if it is a possibility that the at-fault party caused these injuries, this could be grounds to challenge the settlement and seek additional compensation. 

It’s important to mention, however, that reopening a settled case can be extremely challenging; therefore, it is important to consult an attorney to take a look at your case and decide what would be the best course of action. 

For More Information, Get in Touch With Mutrux Today!

Settling with an insurance company is often a difficult process, as oftentimes, the insurance company will attempt to provide you with less than you are owed. When accepting a settlement, it is crucial that you pay close attention to the agreement, such as the limitations it could place on your ability to pursue further legal action against the party responsible.

Although it might not always be clear whether or not you are able to pursue further legal action after a settlement, it’s important to consider factors such as the scope of the agreement, legal rights, and jurisdiction. Therefore, it is important to consult a skilled attorney to help you throughout the process and fight for your rights.

If you believe you have received an insufficient settlement from the insurance company, get in touch with Mutrux Firm Injury Lawyers today! Our skilled attorneys know how to negotiate with insurance companies, and how the local jurisdiction works around the St. Louis area. Call us at (888) 550-4026 or contact us here for more information and to schedule a free consultation.