Short answer: If an insurance company refuses to raise its final offer, you can keep negotiating, use contract remedies (appraisal/arbitration) if your policy allows, file a civil lawsuit for breach of contract and — in some cases — bad faith, or file a complaint with the Pennsylvania Insurance Department. Which path makes sense depends on your policy language, the strength of your evidence, costs, and applicable deadlines.

Disclaimer

This article is for general information only and is not legal advice. I am not a lawyer. For advice about your specific situation, consult a licensed Pennsylvania attorney.

Detailed answer — what happens and what your options are

1. Confirm whether the insurer’s offer is actually “final”

Insurers sometimes label a number “final” but continue to negotiate if the claimant presses the point. Before taking more formal steps, confirm in writing whether the insurer truly considers its last written offer final and whether any contractual dispute-resolution processes apply (for example, appraisal for first-party property claims).

2. Review your policy for dispute procedures

Many Pennsylvania insurance policies include clauses that require appraisal, arbitration, or mediation before a lawsuit. Appraisal is common in property claims; arbitration is common in some liability and UIM/UM disputes. If your policy has a mandatory process, you usually must follow it before suing.

3. Continue negotiation with a strong demand

Before filing suit, send a written demand package that documents your damages: medical records, medical cost summaries, lost-wage proof, repair estimates, photos, and a concise explanation of liability. Include a reasonable deadline for response. A clear, well-supported demand sometimes prompts a higher offer.

4. Consider alternative dispute resolution

Mediation or private arbitration can be faster and less expensive than litigation. If the insurer refuses to budge, propose mediation. Courts in Pennsylvania often encourage settlement via mediation, and private mediators can help bridge the gap.

5. Filing suit: breach of contract and damages

If negotiations fail and your policy does not bar a lawsuit, you can sue the insurer for breach of contract to recover what the policy covers and any damages caused by the breach. In Pennsylvania, the two‑year statute of limitations for many tort claims applies to personal injuries; contract claims often follow different limitation rules. Always confirm the correct deadline for your specific claim so you do not lose the right to sue. (See Pennsylvania consolidated statutes and consult a lawyer.)

6. Bad faith claims — what they are in Pennsylvania

Pennsylvania recognizes the possibility of an extra-contractual bad-faith claim against an insurer in some circumstances. Under Pennsylvania law, courts have allowed claimants to pursue bad-faith remedies when the insurer acted in bad faith in handling the claim. Successful bad-faith claims can lead to punitive damages or attorney’s fees in specific situations. The key statute often cited in Pennsylvania bad-faith contexts is 42 Pa.C.S. § 8371 (the statute referenced most frequently in case law regarding bad-faith remedies). For more about Pennsylvania statutory text and case law, see the Pennsylvania General Assembly site on relevant statutes: https://www.legis.state.pa.us.

7. Administrative complaint with the Pennsylvania Insurance Department

You may file a consumer complaint with the Pennsylvania Insurance Department. The Department can investigate insurer practices, help resolve some disputes, and may take action if it finds violations of insurance regulations. This step does not replace a lawsuit, but it can prompt faster action or at least put regulatory pressure on the insurer. File complaints or find information at: Pennsylvania Insurance Department — File a Complaint.

8. Small claims or civil suit depending on the size of the dispute

If the disputed amount falls within the small claims court limit in your county, small claims court can be an inexpensive option. For larger claims, civil court may be necessary. Litigation brings discovery (depositions, written requests) that can reveal insurer rationale for the low offer and strengthen your case.

9. Costs and risk evaluation

Weigh the expected recovery against litigation costs, attorney fees, and time. Lawyers often take contingency fees in personal injury or insurance-bad-faith matters — discuss fee structure and likely net recovery before hiring counsel. If you accept an insurer’s last written “final” offer, you typically release them from further liability under that claim, so think carefully before signing a release.

Evidence and timing you should preserve

• All written communications with the insurer (letters, emails, recorded notes of phone calls).
• Itemized medical bills, medical records, and summaries tying treatment to the incident.
• Repair estimates, receipts, and photos for property damage.
• Employment records for lost wages and proof of diminished earning capacity if relevant.
• Witness contact information and statements if possible.

When a bad-faith lawsuit might be appropriate

A bad-faith tort claim is generally a higher bar than a contract claim. Bad faith typically requires proof that the insurer acted unreasonably, recklessly, or with knowledge of wrongdoing in handling the claim. Examples could include ignoring key evidence, failing to investigate, or intentionally misrepresenting policy terms. Because bad-faith suits are complex and fact-specific, consult a Pennsylvania attorney before pursuing this route. Courts examine both statutory and common-law authorities; for statutory context, see Pennsylvania statutes at https://www.legis.state.pa.us.

Helpful Hints

• Do not sign a full release until you are certain the offer reasonably compensates you.
• Send a clear, documented demand letter with a deadline before filing suit.
• Check your policy for appraisal/arbitration clauses and read them carefully.
• Keep a contemporaneous log of all insurer communications (date, time, person, summary).
• File a complaint with the Pennsylvania Insurance Department if you suspect unfair practices: https://www.insurance.pa.gov/Consumers/Pages/File-a-Complaint.aspx.
• Talk to a lawyer early—many attorneys offer free consultations and can evaluate whether a bad-faith claim is realistic.
• Be mindful of deadlines (statutes of limitation) and county small-claims limits; missing a deadline can forfeit your rights.