What is a Reserve in a Personal Injury Case?

Dramatization of adjuster not telling you the reserve.

The reserve is an amount of money that the insurance company sets aside to pay your claim.

Generally speaking, if the reserve is set higher in a claim, the adjuster will have authority to pay a larger amount.

Now, you may be dealing with an insurance adjuster, and think he’s extremely nice. To get a good idea of how willing the insurance company is to pay you, ask the adjuster how much he’s reserved the case for.

95 out of a 100 times the adjuster will say “I can’t tell you that, it’s privileged information.” Occasionally you may get an adjuster who says I’ve reserved your claim at “X” amount. Now X could be $5,000, $40,000, $100,000, whatever.

Don’t Assume Adjuster is Telling You the Actual Reserve

Even if the adjuster tells you the reserve, you have to assume that it’s not really the reserve. Why?

If he told you the reserve, he would be showing you all his cards.

Example – Adjuster Told Me a Reserve That Was Totally Wrong

I’ll give you an example of a claim where the adjuster told me a reserve amount that was totally incorrect.

The reserve that he told me was much lower than the actual value of the claim.

After my client was released from the hospital, I made a claim against the truck driver who caused the accident. I sent the adjuster some medical bills and records, and I asked the adjuster “What do you have the claim reserved at?”

He told me “$100,000.00.” Now, from that point forward not much changed with the case. However, we ended up settling for $445,000.00.

So, even if the insurance adjuster does tell you what the reserve is, take what he tells you with a grain of salt.

The reserve is 1 of 8 secrets that insurance companies won’t tell you in a personal injury case.