Insurance companies don’t guess when they make a settlement offer. An adjuster studies your records, runs your claim through a formula, and trims the result. If that offer feels small compared to the pain and disruption you live with, a Santa Fe personal injury lawyer can explain what the number really means.
How Adjusters Value a Claim
Most companies divide your losses into two groups: economic and non-economic losses. Economic losses include medical bills, future treatment, lost wages, and other out-of-pocket costs. Non-economic losses cover pain, emotional distress, and changes to your everyday life.
Bills and pay stubs cover the first group. Judgment calls shape the second, which is where the multiplier method and per diem method come in.
The Multiplier Method
With the multiplier method, an adjuster totals your economic losses and chooses a number to multiply that total by. That number is the “multiplier.”
Lower multipliers, like 1.5 or 2, are used in claims with short treatment and relatively minor pain. Higher multipliers, like 4 or 5, are used when someone needs surgery, faces a long recovery, or lives with permanent limits.
To choose a multiplier, an adjuster looks at injury severity, length of treatment, chances of full recovery, and any permanent pain and restrictions. If your medical bills and lost income equal $20,000 and the adjuster applies a multiplier of 3, they will determine that your claim’s value is around $60,000.
The Per Diem Method
Some companies use a per diem method to value your non-economic losses. An adjuster assigns a daily dollar amount, usually your daily wage, to your pain and other intangible harm. Then, they multiply that by the number of days you spent recovering.
They might say your pain is “worth” $200 per day for 90 days of recovery, which creates $18,000 in non-economic damages. They add that number to your medical costs and wage loss.
Most disputes with this method focus on two questions: did they pick a fair daily rate, and did they stop the recovery clock too early?
Details That Move the Number
Formulas only provide a starting point. Real-world facts move the offer up or down, including total medical expenses, treatment duration, injury type, impact on work, and changes to daily life. Adjusters also hunt for gaps in care or old injuries and sometimes use those details to claim you are not as severely injured as you know you are.
Policy Limits and Shared Fault
Strong claims still run into policy limits. If you were injured in a car accident, and the at-fault driver only carries $25,000 in bodily injury coverage, and your losses exceed that, the insurer treats $25,000 as the cap. Your own underinsured motorist coverage or claims against other parties can help, but those limits still shape how far a settlement can realistically go.
New Mexico also uses a pure comparative negligence doctrine. Under this doctrine, you can still recover money even if you share some of the blame, but your percentage of fault reduces your recovery. If your losses total $100,000 and an adjuster claims you bear 30 percent of the fault, they may try to cut the payout to $70,000.
What To Do When You Receive an Offer
You do not need to accept the first offer an insurance company sends you. Before you decide, you can compare the offer to your bills and wage loss, ask how they calculated pain and suffering, check whether they included future treatment, and question any fault percentage they assign to you.
How We Look at Settlement Offers
When you receive a settlement offer, you deserve clear answers before you sign away your rights. At Hunt Law Firm, we’ll review your records, break down the formulas insurers use, and explain how policy limits and fault issues affect your claim.
We’ll speak with you directly, walk you through your options, and stand in your corner as Santa Fe personal injury lawyers who care about what this injury did to your life, not just what an insurance company wants to pay. Call us today.