Detailed Answer

After an accident, an insurance company may offer a settlement that you feel is too low. Under New Mexico practice, you can challenge that offer through a sequence of steps: gather evidence, present a written demand, negotiate or use informal appeals, pursue alternative dispute resolution (mediation or appraisal when available), file an administrative complaint with the New Mexico Office of Superintendent of Insurance (OSI) for improper claim handling, and, if needed, file a lawsuit before your legal deadline expires. Below is a practical, step-by-step process with a sample hypothetical to illustrate.

Hypothetical

Suppose you were rear-ended and incurred $12,000 in medical bills, lost wages, and out-of-pocket expenses totaling about $18,000. The at-fault driver’s insurer offers $4,500. You believe the offer does not fairly compensate your damages. Here is how you can appeal that offer in New Mexico.

Step 1 — Review your policy and the offer

Read your policy and the insurer’s explanation of the settlement. Confirm what coverages apply (liability, medical payments, UM/UIM, property damage). Note any deadlines the insurer gives and save all correspondence. Document the insurer’s settlement amount and its reasons for the valuation.

Step 2 — Build a demand package

Put together a clear demand packet that supports a higher value:

• Medical records and itemized bills.
• Paystubs or employer statements for lost wages.
• Repair estimates or receipts for property damage.
• Photos of injuries and damage.
• Police report, witness contact info, and a concise narrative of fault and injuries.
• A short cover letter that states the demand amount and why the current offer is inadequate.

Step 3 — Send a written demand and open negotiations

Send your demand by certified mail or another trackable method. Ask the adjuster to explain the basis for the low offer and request a written response. Keep communication professional and fact-based. Insurers frequently respond to organized, documented demands rather than emotional pleas.

Step 4 — Use the insurer’s internal appeal process

Many insurers have an internal appeal or re-review procedure. Ask the adjuster how to escalate the claim to a supervisor or to the insurer’s claim review unit. Submit any newly obtained records and highlight legal or medical points that support your valuation.

Step 5 — Consider alternative dispute resolution

If direct negotiation stalls, consider mediation. Mediation is voluntary in most personal injury cases and uses a neutral mediator to help both sides reach a settlement. Mediation often preserves good will and costs much less than a trial. If your dispute is about property damage under a homeowner or auto policy that includes an appraisal clause, you can trigger appraisal: each side chooses an appraiser and they select an umpire to resolve the value dispute.

Step 6 — File a complaint with the New Mexico insurance regulator

If you believe the insurer acted unfairly or violated claim-handling rules, you may file a complaint with the New Mexico Office of Superintendent of Insurance (OSI). The OSI can investigate improper claim practices, help you understand insurer obligations, and sometimes facilitate communication. Start here: File a complaint with the NM Office of Superintendent of Insurance.

Step 7 — Evaluate small claims or civil court options

If negotiations and mediation fail, you can consider a lawsuit. For smaller dollar disputes, New Mexico’s court system offers streamlined procedures (self-help and small-claims options) that are faster and less formal than full civil trials. For more complex injury claims, you will likely need an attorney. Visit the New Mexico Courts self-help pages to learn filing steps: New Mexico Courts — Self Help.

Step 8 — Know deadlines and consider counsel

Before you file suit, confirm the applicable filing deadline (statute of limitations) for your type of claim. Missing that deadline can bar your case. If your damages are significant or fault is contested, contact a New Mexico personal injury attorney to assess the strength of your claim and your litigation options.

What you can expect from an attorney

An attorney will evaluate liability, demand strategy, and whether to pursue mediation or litigation. Attorneys commonly take personal injury cases on contingency (they get paid only if you recover). A lawyer can also handle communications with insurers, gather expert reports, and file suit if negotiation remains unsuccessful.

When to accept an offer

Accept an offer only after you have a realistic sense of all present and likely future damages (medical treatment, long-term care, lost earnings, pain and suffering). A settlement is generally final: once you accept and sign a release, you typically give up the right to pursue additional compensation related to that accident.

Helpful Hints

• Preserve all evidence and records from the moment of the accident.
• Put every demand and settlement communication in writing and keep copies.
• Track deadlines: insurer response timelines, OSI complaint windows, and court filing deadlines.
• Ask the insurer to explain how it calculated its offer; request the claim file if needed.
• Mediation can be faster and less expensive than suing. Consider it early.
• File an OSI complaint if you suspect bad-faith handling; OSI can investigate and guide you: NM OSI Consumer Resources.
• Use the New Mexico Courts self-help center to learn small-claims and civil filing procedures: NM Courts Self Help.
• Consult an attorney before signing any release. Releases typically end further recovery for the accident.