Detailed Answer
Short overview: After an accident, if an insurance company makes a settlement offer you believe is too low, you have a sequence of practical and legal options: gather and organize evidence, send a well‑documented demand, use any contract dispute processes (appraisal, mediation, or arbitration) built into the policy, escalate to a lawyer for negotiation or litigation, or file a consumer complaint with the Rhode Island Division of Insurance. If you sue, make sure you file before the statute of limitations expires. This article explains each step and how they work under Rhode Island law.
1) Check your policy and timing
Start by carefully reading your insurance policy. Look for clauses about appraisal (common for property damage), mandatory arbitration, or required notice deadlines. Those policy terms can limit or expand your options.
Preserve deadlines. For personal injury claims in Rhode Island, the statute of limitations for most actions for injuries to the person is three years. See R.I. Gen. Laws § 9-1-14: https://webserver.rilin.state.ri.us/Statutes/TITLE9/9-1/9-1-14.htm. If you miss filing a lawsuit before the statute runs, you could lose the right to sue.
2) Document your damages thoroughly
Insurers base offers on the documentation you provide. Build a clear, dated file with:
- Police report and accident scene photos;
- Medical records, doctor notes, and itemized bills;
- Proof of lost wages (paystubs, employer letters);
- Repair estimates, receipts, and depreciation documentation for property damage;
- Witness contact information and statements;
- Any correspondence with the adjuster.
3) Send a focused written demand
Prepare a demand letter summarizing liability, itemized damages, and your requested dollar figure with supporting exhibits. Set a reasonable deadline for response (for example, 14–30 days). A clean, well‑supported demand removes ambiguity and often prompts a better offer.
4) Use policy dispute mechanisms if available
If your policy contains an appraisal clause for property damage, the appraisal process can produce an enforceable resolution of the amount of loss without a lawsuit. If the policy specifies mediation or arbitration, those are often faster and cheaper than court. Read the policy requirements carefully and follow notice and timing rules.
5) Negotiate and consider escalation
If the insurer refuses to increase its offer, options include:
- Escalate within the company: ask for a supervisor or appraisal review;
- Use a mediator to attempt settlement (voluntary but often effective);
- Hire an attorney to negotiate. Many personal injury lawyers take cases on contingency, meaning they advance costs and get paid a percentage of recovery; for property-damage only claims, attorneys may charge differently.
6) File a consumer complaint with Rhode Island Division of Insurance
If you believe the insurer failed to investigate reasonably, engaged in unfair claim practices, or acted in bad faith, you can submit a complaint to the Rhode Island Department of Business Regulation, Division of Insurance. They accept consumer complaints, investigate insurers, and can help enforce insurance rules. File complaints or get information here: Rhode Island Division of Insurance – File a Complaint (DBR).
7) Small claims or lawsuit
If informal and administrative steps fail, you can sue. For smaller property damage claims, Rhode Island District Court small‑claims procedures can be faster and less costly. For bodily injury claims or larger disputes you typically file in Superior Court. Before filing a lawsuit check the correct venue and file within the statute of limitations. For small claims procedures see the Rhode Island Judiciary’s guidance: Rhode Island Judiciary – Small Claims. For complex claims, an attorney helps evaluate whether to sue and can manage pre‑suit demands and litigation strategy.
8) When a bad‑faith claim applies
Rhode Island law allows insureds to pursue remedies when an insurer unreasonably denies or delays benefits or violates unfair‑practice rules, but bad‑faith claims are fact‑specific. Before asserting bad faith, document the insurer’s conduct (denial reasons, communication gaps, lack of investigation). Consult an attorney to evaluate whether the insurer’s actions meet the state standards for an extra‑contractual claim.
9) What to expect if you proceed to litigation
Litigation steps typically include filing a complaint, discovery (exchanging documents and depositions), motion practice, and either trial or settlement. Lawsuits take time and carry costs, but they can produce full compensation, interest, and sometimes costs or punitive damages depending on the conduct and applicable law.
10) Practical timeline and strategy
Typical path and timing:
- 0–30 days: gather records and send demand;
- 30–90 days: negotiate, request appraisal/mediation if available;
- 90+ days: if no reasonable resolution, consult an attorney and consider filing a complaint with DBR or initiating litigation before the limitations period ends.
Resources and relevant Rhode Island links
- Rhode Island General Laws – statute of limitations for personal injury (R.I. Gen. Laws § 9-1-14): https://webserver.rilin.state.ri.us/Statutes/TITLE9/9-1/9-1-14.htm
- Rhode Island Department of Business Regulation, Division of Insurance – consumer complaint information: https://dbr.ri.gov/divisions/insurance/consumer-information/file-complaint.php
- Rhode Island Judiciary – Small Claims information: https://www.courts.ri.gov/Courts/DistrictCourt/Pages/SmallClaims.aspx
Helpful Hints
- Keep a single organized claim file with dates and copies of every document and communication.
- Never sign a full release without confirming the payment matches what you agreed to and that it covers all future claims related to the accident.
- Ask for the insurer’s full reservation-of-rights or denial explanation in writing.
- Consider a demand package with a clear settlement number and supporting evidence to improve leverage.
- If the insurer cites policy language, ask for the exact clause and page; request that they explain how the clause applies.
- Appraisal and arbitration clauses often have strict notice requirements—follow them to preserve these options.
- Consult an attorney before filing suit or alleging bad faith. An initial consult can clarify strength of your case and cost/benefit of litigation.
- File a DBR complaint if you believe the insurer breached regulatory duties—DBR can intervene administratively although it cannot award you money directly like a court can.
Disclaimer: This article is informational only and is not legal advice. It does not create an attorney‑client relationship. For advice about your specific situation, consult a licensed Rhode Island attorney.