When it comes to getting fair compensation for an insurance claim, the demand letter is an important tool. It communicates clearly to the other party about the appropriate amount of compensation. It can be used to share evidence that supports the claim and the amount you’re seeking – although information should be shared strategically under the guidance of an experienced attorney.
A demand letter can be a useful tool in fairly resolving an insurance claim. To use it effectively, you must understand the timeline.
In this article, we will explore the following questions:
What is the timeline for sending a demand letter?
What is the timeline to get an answer from a demand letter?
What should I do if the insurance company doesn’t respond in a reasonable amount of time?
Our injury attorneys explain the demand letter timeline and how long the process should take.
The Timeline for Sending a Demand Letter
The timeline for sending a demand letter varies depending on how long it takes to value your damages and the amount of compensation you deserve. The exact answer for when you should send a demand letter for an insurance claim depends on the complexity of the case.
A demand letter is a clear and concise statement of how you would like to see the case settled. It can take some time after the accident to know what the case is worth. Especially if your injuries are moderate or severe, understanding the prognosis can take time.
You should send the demand letter once you have a complete picture of your damages and you have determined the value of the case. For injuries that are anything but minor, this is likely to be a few months or even several months following the accident. It shouldn’t be rushed, because you have only one opportunity to settle your case.
One of the important ways that our experienced attorneys at Upstate Personal Injury Lawyers, LLC help you is by investigating the value of your case and determining when it’s time to prepare and send your letter.
How Long Does It Take to Receive an Answer From a Demand Letter?
South Carolina does not have a set timeline for how long the insurance company can take to respond to a demand letter. The law requires them to work in good faith to acknowledge communications and settle each claim where liability is clear.
For claimants, the lack of a clear timeline for getting an answer from a demand letter can be frustrating. However, timelines vary because case complexity varies. The more you’re asking for in compensation, the longer it’s going to take the insurance company to investigate. However, that doesn’t mean that the insurance company can take as long as they want to. They must still work in good faith to resolve claims and respond to communications including demand letters.
The requirements for the insurance companies come from S.C. Code § 38-59-20 – Improper claim practices. The relevant portions of the law for responding to a demand letter are:
- Responding with reasonable promptness to pertinent communications regarding claims
- Having standards to promptly investigate and settle claims
- Equitably setting claims in good faith when liability is reasonably clear
In other words, the insurance company has a duty to hold up their end of the contract, and within a reasonable amount of time. The law doesn’t specify a timeline – but it does impose requirements on the insurance company to act within a reasonable amount of time.
These requirements are reinforced by South Carolina case law:
In Nichols v. State Farm Mutual Auto. Ins. Co., 279 S.C. 336 (1983), the plaintiff sued for insurer bad faith handling of a claim. The court reiterated previous case law that unreasonable refusal by the insurance company to accept a settlement offer makes it liable in tort for bad faith. See Miles v. State Farm Mutual Ins. Co., 120 S.E.2d 217 (1961). Actual damages are not limited by contract. The actions of the insurance company in responding to the claim are relevant to determine whether they acted in bad faith. See Robertsen v. State Farm Mut. Auto. Ins. Co., 464 F. Supp. 876 (Dist. S.C. 1979).
The Tyger River Pine Co. case was about whether the insurance company was negligent or acted in bad faith in its negotiations for compromise and settlement. In the Tyger River Pine Co. case, the court said that the letters made in offer of settlement were evidence of whether the defendant acted in good faith.
The case reinforces that a demand letter prompts the insurance company to respond in a reasonable manner based on its obligations under South Carolina law. If the plaintiff presents sufficient evidence of bad faith, it is a question for the jury to decide. Tyger River Pine CO. v. Maryland Casualty Co., 170 S.E. 346 (S.C. 1933).
What If the Insurance Company Doesn’t Respond in a Reasonable Amount of Time?
Remember that South Carolina imposes time limits to file a personal injury claim. For car accidents, the time limit is three years. Even if you’ve sent a demand letter, the timeline is final. Don’t wait too long if the insurance company hasn’t responded or if they’re causing delays.
Once the statute of limitations has passed, it won’t be a defense that they never responded to your demand letter. Always be aware of deadlines and be sure to file your case on time.
You have only a limited amount of time to file suit if the insurance company isn’t acting in good faith. If you suspect that it has taken the insurance company too long to acknowledge and respond to your demand letter, it’s time to talk to an attorney.
We can make sure that your demand letter contains the important information and take the next steps if the insurance company doesn’t respond within a reasonable amount of time.
The best time to hire an attorney is as soon as possible. We can prepare your demand letter and negotiate your settlement. Contact our attorneys for a review of your situation.
