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How Are Attorneys Paid in Personal Injury and Insurance Cases?


Some of the biggest hurdles in hiring an attorney for most people are concerns about paying the attorney. Unfortunately, big business and insurance companies often fuel this concern, putting out false news stories or “helpful” websites that may warn consumers about how much it will cost to hire an attorney. In some cases, insurance adjusters will use the supposedly high cost of hiring an attorney as a weapon to try to coerce consumers into settling claims for less than what the claim is worth.

All of these concerns are false in the area of personal injury and homeowners’ insurance loss claims. That’s because in both cases, hiring an attorney will cost you very little, and sometimes, nothing at all.

Personal Injury Cases

In a personal injury case, your attorney will work on contingency. Your attorney only gets paid if you settle your case, or win a verdict at trial (we’ll call either of these your recovery). Your attorney takes a percentage of whatever you recover at the end of your case.

So, if your recovery is $100,000 and your contingency agreement provides that your attorney is paid 40%, your attorney would get $40,000. This contingency agreement works for both sides. For the attorney, it incentivizes him/her to get the maximum possible dollar figure for you. You get a qualified attorney who is willing to litigate the case for as long as it takes without you having to pay anything out of pocket, and with no risk of owing your attorney fees if the case is lost.

Homeowners’ Insurance Cases

Homeowners’ insurance cases are a little different. The attorney is still working on contingency, which means you still do not pay the attorney out of pocket. Florida Statute 627.428 provides that the insurer pays the homeowner’s attorney a fee in addition to the amount of the claim, if the attorney has secured a recovery greater than an amount offered by the insurance company prior to litigation.

For example, if the insurance company pays you $100,000 and your attorney expended $40,000 worth of time on the case, the insurance company would have to pay $140,000. Sometime the attorney-fee contract may be a hybrid in which the contingency fee is reduced by the fee paid by the insurance company.

By structuring fees this way, the homeowner can be certain that he or she has enough money to fix and repair whatever is needed in the home. If the home needs $100,000 of repairs, the homeowner would get that amount (assuming a win or settlement), without having to subtract fees.

Other Expenses

In both types of cases, you may have other expenses deducted from your settlement such as medical bills, expert fees, and costs.

Contact the West Palm Beach homeowners’ insurance attorneys at the Celeste Law Firm today for a consultation if you are having trouble when making claims for homeowners’ insurance benefits for any repair or damage on your property.


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