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What Is the Average Settlement Offer During Mediation?

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C.L. Mike Schmidt Published by C.L. Mike Schmidt

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It is usually impossible to figure out the average settlement offer during mediation. The main reason is that each case can be very different. Some cases might imply more injuries, which means they would get a higher offer than others. 

With years of legal experience in personal injury lawsuits, I will provide you with all the information needed to understand average settlement offers during mediation so that you know what to expect.

Quick Summary

  • Mediation is an efficient and budget-friendly way to end disagreements and agree on a final settlement.
  • Most mediators will offer an opening suggestion that they deem adequate given the information.
  • The majority of cases are settled before going to trial.

What Is the Purpose of Mediation?

A lawyer explaining to clients the purpose of mediation

The purpose of mediation is to provide the most cost effective and quickest way to resolve disputes. Mediation is a private process in which a neutral third party facilitates settlement talks between the parties in separate rooms to reach an agreement [1].

Before delving into mediation strategies, it's crucial to understand how utilizing mediation can advantageously settle a lawsuit compared to regular settlement discussions or proceeding directly to litigation. 

Benefits include the following:

  • Control: Mediation gives control over its outcome to the opposing parties involved in the dispute, as opposed to litigation, where a judge or jury makes the decisions.
  • Voluntariness: With mediation, the parties are not locked in compared to litigation and can pull out at any time.
  • Compliance: More parties tend to comply with a settlement agreement they came to with the insurance company, as opposed to a judgment from the court.
  • Speed: Resolving a conflict through mediation takes significantly less time than going to trial, which could stretch for months or even years. Mediation can often be completed in just one or two days.

Most mediators will initially suggest a number that they believe is fair and reasonable based on the details of the case. This is usually done after all parties have had time to present their respective positions. 

The goal for the mediator is to get both sides to agree on a settlement amount that everyone can live with, putting into consideration the realistic case value.

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What Is the Average Settlement Offer During Mediation?

A lawyer pointing out the average settlement offer during mediationThe average settlement offer during mediation will usually fall between 20-50 percent of the damages suffered. It is important to remember that this is just an average, and each case might be different.

For example, people typically start far apart and disagree on many points. The process can take a long time, but most progress happens later on. 

The mediator cannot pick a side, so both sides must compromise.

Most cases settle before going to trial. This means that both sides agree on something instead of going to court. 

After a settlement is reached, we don't know if either side could have done better by going to trial. 

From my experience mediating over the last decade, the following four things are typically true:

1. The Lawyers Don't Know The Facts

All too often, only one side comes to mediation adequately prepared. This party makes detailed statements usually reserved for trial opening statements. 

When this happens, and the other parties give an opening statement lacking in substance or conviction, it becomes difficult to resolve the disagreement during that day of mediation.

2. The Initial Offer Is Insulting

Suppose the initial offer from the insurance company doesn't even come close to covering your car accident medical bills. 

Where do you get the money to pay the attorneys' fees and the mediator? The plaintiff usually feels insulted by this common defense strategy, which is meant to discourage them before trial. 

3. A Long, Slow Day

Though the morning might start productively, with both sides attentive and engaged, offers are usually slow to pick up until after lunch. 

Progress is generally made when both parties understand that they would rather have the case settled and leave sooner to get home in time for dinner.

4. You Get Less Than You Wanted, and They Pay More Than They Wanted

When people come to me for mediation, I always tell them that a successful mediation is when the plaintiff receives less than they wanted and the insurance company pays more. 

That's called compromise. I advise those going into mediation to be ready to accept an offer lower than what they originally intended from the opposing party. 

It's up to you whether or not you want to agree to this lesser amount, but mediators will float around during the discussion.

"Despite the many different facts and circumstances that arise in mediation cases, some factors remain constant"
- Randall J. Trost, Attorney

FAQs

What Is The Most Difficult Part Of The Mediation Process?

The most difficult part of the mediation process is to help people see that it can be an effective way to settle their disputes. Disputes are often personal, and some individuals want a chance to air their grievances in court, even if it's costly.

How Long Does A Mediation Session Last?

A mediation session usually lasts for 2-3 hours. Depending on the issue, some cases may require only a single session while others necessitate more.

How Often Do Car Accident Cases Go To Court?

Car accident cases rarely go to court. Most automobile accident cases are resolved through settlements, which means that the parties involved agree to an out-of-court dispute resolution rather than litigating a case in a courtroom. 

Be Well Prepared For Mediation

Mediation is an ideal way for the involved parties to agree on going through the legal process, especially when new evidence has been found or a party's position has changed. 

This method is also useful in personal injury cases where both sides are willing to settle but can't seem to arrive at an agreeable number that interprets their underlying interests.

Be prepared for your mediation by contacting Schmidt & Clark, LLP. In your free consultation, our personal injury lawyers will work with you to review your personal injury case and give advice on how best to approach a successful mediation. With the right team, you can make sure that both sides leave feeling satisfied.


Reference:

  1. https://www.commerce.gov/cr/reports-and-resources/eeo-mediation-guide/what-mediation