Detailed Answer — How a “full and final” settlement works in Texas and what to do if you still need treatment
When an insurer’s adjuster offers a “full and final” settlement, the insurer expects you to sign a release that closes the claim and gives up any right to future recovery for injuries, medical care, and related losses arising from that incident. Under Texas law, a properly drafted release generally is a binding contract. If you sign away future claims and later need more medical care, you usually cannot force the insurer to pay additional treatment costs unless the release included a specific reservation for future care or there is a legal reason to undo the release.
Why this matters
Medical conditions can develop or worsen after a settlement. Signing a broad release without preserving future medical rights commonly leaves you personally responsible for those added costs. Before you sign, know exactly what you are giving up.
What a release typically does
- Creates a contract that extinguishes claims covered by its language.
- Will be enforced according to its written terms in Texas courts unless invalid for legal reasons (fraud, duress, mutual mistake, or unconscionability).
- May resolve only specific categories (for example, past medical bills and pain and suffering) if the release is narrowly worded, or it may bar all present and future claims if broadly worded.
Relevant Texas law and where to learn more
Releases and contract enforcement in Texas are governed by contract principles enforced by Texas courts. The statute of limitations for personal-injury lawsuits can affect your ability to sue later; see Texas Civil Practice & Remedies Code, Chapter 16: https://statutes.capitol.texas.gov/Docs/CP/htm/CP.16.htm.
If an insurer engages in unfair settlement practices or delays payment, Texas law provides consumer protections under the Insurance Code. See, for example, Texas Insurance Code Chapter 541 (prohibited unfair/deceptive acts) and Chapter 542 (prompt payment of claims): https://statutes.capitol.texas.gov/Docs/IN/htm/IN.541.htm and https://statutes.capitol.texas.gov/Docs/IN/htm/IN.542.htm. The Texas Department of Insurance also has consumer resources about claims and settlements: https://www.tdi.texas.gov/consumer/index.html.
Options before you sign
If you still need treatment, consider these choices:
- Delay signing. Tell the adjuster you need more time for medical evaluation and records. Do not sign under pressure.
- Negotiate a limited release. Ask the insurer to prepare a release that covers only past medical bills and past non-economic losses while preserving rights to future medical treatment related to the accident.
- Ask for a medical reserve or holdback. Negotiate a portion of the settlement to be set aside to cover future medical costs if they become necessary.
- Request structured payments for future medical care or a specific fund for predicted treatments.
- Insist the insurer pay remaining medical bills that are already known and document any outstanding treatment plan.
- Get everything in writing. Verbal promises are hard to enforce.
If you feel pressured or the adjuster is unreasonable
Insurers may seek quick closure. If an adjuster uses misleading or bad-faith tactics, you can report the conduct to the Texas Department of Insurance and consider legal help. Texas law prohibits certain unfair or deceptive insurance practices and requires timely payment of valid claims—see Texas Insurance Code, Chapters 541 and 542: IN §541 and IN §542.
If you already signed a full release and now need more treatment
- Carefully read the release. Some releases contain carve-outs for specific payments or providers.
- Act quickly. Statutes of limitations and procedural rules may limit your options.
- Possible but limited remedies: you may challenge the release if it was obtained by fraud, misrepresentation, mutual mistake, duress, incapacity, or if the release is unconscionable. These are fact-specific and often difficult to prove.
- Contact an attorney for a case-specific evaluation. An attorney can review the release language, medical records, and communications from the insurer to determine whether a legal challenge is feasible.
- Check for liens and subrogation. Health insurers, medical providers, or Medicare/Medicaid may have rights to be reimbursed from any recovery. You must address those claims even if you successfully reopen a claim.
Practical hypothetical examples
Example A — Minor injury: You’ve reached a point where symptoms are resolving and your doctor expects no future care. A narrowly written release for past medical bills and pain and suffering may be reasonable.
Example B — Potential surgery: Your doctor lists surgery as a possible next step. Do not sign a broad release. Instead, negotiate a reserve for future medical costs or delay signing until your treatment path is clear.
What to document
Keep copies of all medical records, bills, doctor opinions about future care, written settlement offers, and any communications with the adjuster. If you choose to negotiate, give the insurer written notice of ongoing or anticipated treatment and the estimated cost so the adjuster cannot claim surprise later.
Helpful Hints
- Do not sign a full and final release until you understand exactly what it covers.
- Ask for and keep written offers and communications from the adjuster.
- Get your treating doctor’s opinion in writing about whether further treatment is likely and a cost estimate.
- Negotiate limited releases, reserves, or structured settlements when future care is possible.
- Be cautious of quick, high-pressure settlements pushed before you finish treatment.
- If you believe the insurer acted in bad faith or misled you, contact the Texas Department of Insurance: TDI consumer information.
- If you already signed and need help, consult an attorney promptly. Time limits and evidentiary issues can affect your options.
- Consider who may have a lien (health insurer, medical providers, Medicare). Resolving liens is necessary before a clean recovery.
Disclaimer: This information explains general Texas law concepts and common settlement practices. It is not legal advice, does not create an attorney-client relationship, and may not apply to your situation. Consult a licensed Texas attorney for advice tailored to your facts.