Will the Insurance Company Make an Offer to Settle My Car Accident Case in Ontario?
Updated: Sep 3
By Eddie Wiley
Personal Injury Lawyer
Hillier & Hillier Personal Injury Lawyers
The insurance company will usually make an offer to settle your case. However, it is not required to do so and, in some cases, may not make an offer to settle at all.
Whether an insurance company will offer to settle your case depends on the specific facts, including the severity and prognosis of your injuries, liability for the accident, the strength of the evidence, and the amount of damages being claimed. As each case is different, there is no universal rule as to whether an insurance company will offer to settle your case. However, building your case for trial typically provides the best chance that the insurance company will advance a reasonable offer to settle your case.
Contact Hillier & Hillier at 905-453-8636 for a FREE CONSULTATION or click here to submit an online request for a free consultation.
When Will an Insurance Company Make a Settlement Offer?
An insurance company can make an offer to settle your case at any time following an accident. Settlement may occur before a lawsuit is commenced, during the litigation process, or even during trial. The steps in a lawsuit include the following:
Car Accident
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Retain Lawyer
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Investigation
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File and Exchange Pleadings (Start and Serve Lawsuit)
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Documentary Discovery (Exchange Relevant Documents)
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Discovery Examinations
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Medical Assessments
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Mediation
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Pre-Trial
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Trial
Settlement can occur at any of the above stages. A case may settle within months of an accident or several years later, including during trial.
Why Would an Insurer Make an Early Offer to Settle?
An insurance company may make an early offer to settle your case to avoid the cost of litigation. As well, insurance companies may advance an early offer at a significant discount before a case is fully developed and before the evidence necessary to properly assess the full value of your case has been obtained.
In some instances, discussed below, early offers may also be made where the claims for damages are fully developed at an early stage.
Should I Accept an Early Offer?
This depends on the facts of your case and ultimately whether you are able to ascertain the severity of your injuries, their prognosis, and their impact on your life.
Many individuals involved in a car accident may be tempted by early offers made by the insurance company. However, settling your case at an early stage is not always advisable. For example, you may not yet have gathered crucial medical evidence discussing the severity of your injuries, the poor prognoses of these, and the impact of your injuries on your ability to work. If you accept an early offer without this information, you risk being undercompensated as you are not fully aware of the impact of your injuries on your life. An individual who fractures their arm in a car accident and accepts an early offer to settle may subsequently be dismayed when they learn their fracture will develop severe arthritis and require future surgery, and the settlement does not reflect these future events.
By contrast, in some cases it may be advisable to settle your case at an early stage. This typically occurs where you understand the severity and prognosis of your injuries, and their impact on your life. For example, if an individual fractures a collarbone which completely heals without any complications, it may be advisable to settle at an early stage rather than proceed through lengthy litigation.
While there is no universal rule, early settlement may be appropriate where minor to moderate injuries have healed and when there are no significant claims for future income loss, housekeeping assistance, or future care. The benefits of early settlement include avoiding lengthy litigation and obtaining immediate access to settlement funds.
Conversely, serious injury cases often require expert evidence before the value of the claim can be properly assessed. Medical experts may be required to address the severity and prognosis of your injuries and their future impact on your lifestyle and ability to work. If you are advancing a future income loss claim, accounting evidence may also be required to calculate the present value of that loss. This evidence is typically obtained after discovery examinations and often several years after the accident.
What Does the Insurance Company Consider When Making an Offer?
In making an offer, the insurance company will consider all relevant issues in the lawsuit including the following:
Liability/Fault for the Accident: if you are partly at fault for the accident, the insurer will typically reduce its offer to reflect the degree to which you may be found at fault by a judge or jury. This is known as contributory negligence. For example, if you are found 15% at fault, your compensation will be reduced by 15%. By contrast, if the other driver is completely at fault, no reduction will be made. Hillier & Hillier has written extensively about contributory negligence, and you may view our article on this topic for more information.
Nature and Severity of Injuries: typically, the more severe your injuries, the higher amount will be offered by the insurance company to settle your case. This is just one factor assessed alongside many others to determine the overall amount. In some situations, an individual with more severe injuries and who is partly at fault for an accident may be offered less than an individual with less severe injuries who is not at fault at all.
Pre-Existing Conditions: insurance companies may reduce their offer if you have pre-existing conditions that would have impacted your lifestyle in any event. For example, if you had a pre-existing medical condition that would have prevented you from working by a certain age, the insurer will reduce an offer to settle your income claim to account for this fact. In some circumstances, however, an individual’s pre-existing condition may expose them to greater injuries from a car accident, which may result in a higher offer.
Income Loss/Loss of Earning Capacity: this is a major factor. Income loss can form one of the largest components of a personal injury claim. An individual whose career was ended due to injuries sustained in an accident will often be offered more than an individual who returned to work after an accident or was already retired at the time of an accident.
Future Care Needs: future care needs can also form a large part of an individual’s claim depending on the level of care they require due to the injuries sustained in a car accident. Individuals with large future care claims will be offered more than individuals who require little to no care.
Housekeeping/Home Maintenance Claims: likewise individuals who are unable to perform their pre-accident housekeeping and home maintenance chores will usually be offered more than individuals who are able to resume these tasks.
Credibility: this is another important factor. An insurer will consider whether a judge or jury is likely to believe and rely upon your evidence. Credibility may be affected by inconsistent statements about your injuries, failing to disclose pre-existing medical conditions, or surveillance that contradicts your stated limitations. For example, surveillance showing a plaintiff exercising with heavy dumbbells after stating they cannot lift more than five pounds may significantly undermine their credibility. An insurer will typically offer more where a plaintiff’s evidence is credible and likely to be accepted at trial. For more information on how insurance companies gather and use surveillance, click here.
Threshold Injuries: this applies to awards for general damages for pain and suffering. You must first prove that you sustained a “threshold injury” to claim general damages. In other words, your injuries must result in a serious and permanent impairment of an important physical, mental or psychological function that impacts your daily activities. If you are able to resume your employment and usual activities without significant restriction, an insurer may be less inclined to offer you anything for general damages because there is a greater risk your injuries will not meet the threshold.
Statutory Deductible: this also applies to awards for general damages for pain and suffering. In 2026, if you are awarded $159,708.71 or less for pain and suffering, your award will be automatically reduced by a statutory deductible of $47,913.01. An insurance company will consider whether the statutory deductible may apply when assessing your claim and may offer less where there is a real risk that your award will be subject to the deductible.
Medical Evidence and Expert Evidence: the strength of your claims depends on the strength of the medical evidence and expert evidence gathered to support your claims. Insurance companies will usually offer less where there is little medical evidence to support your claims or if the opinions of your medical experts are contradicted by the medical records or not strong for other reasons.
The above is not an exhaustive list of relevant factors. As well, each factor above is not considered in isolation. Rather, insurance companies and personal injury lawyers consider all factors together when assessing the value of your case. For more information on how the value of a personal injury claim is assessed, click here.
What Will the Insurance Company Offer?
It is impossible to predict what an insurance company will offer. The amount offered depends on the facts of each case, and some insurance companies may offer more than other companies.
Offers may include:
An offer that you agree to pay a portion of the insurance company’s costs in exchange for a dismissal of the case (rare).
An offer that you agree to dismiss the case in exchange for receiving nothing and having to pay nothing (a without costs dismissal).
An offer to pay some of your legal fees and disbursements but nothing for damages in exchange for the case being dismissed.
An offer to pay you for some or all of your damages, plus a portion of your costs, plus disbursements.
The type and amount of an offer will ultimately depend on the strength of your case and the evidence available to support your claims.
What If the Insurance Company Refuses to Make a Reasonable Offer?
If the insurance company refuses to make a reasonable offer, you should continue preparing your case for trial. Settlement discussions may continue as the case progresses, but you should be prepared to proceed to trial if a reasonable settlement cannot be reached.
The parties will often exchange formal offers to settle under Rule 49 of the Rules of Civil Procedure. These offers can have significant cost consequences following a trial and may encourage the parties to settle rather than proceed to a verdict.
What is a Rule 49 Offer?
A Rule 49 offer is a formal written offer to settle made under Rule 49 of the Rules of Civil Procedure. To trigger the cost consequences provided by Rule 49 following a trial, the offer must be delivered at least seven days before trial and remain open for acceptance until immediately after the start of trial. Additionally, the terms of the offer must be sufficiently clear so that the parties can ascertain whether the verdict exceeded or fell below the amount offered for damages.
Informal settlement offers, made verbally or in written correspondence such as emails, that do not meet the above requirements will not attract the cost consequences provided by Rule 49.
The purpose of Rule 49 offers is to facilitate settlement by imposing heightened cost consequences on parties that do not make or accept reasonable offers.
Generally, the successful party at a trial may recover a portion of their legal costs from the unsuccessful party. In the absence of a Rule 49 offer, the successful party is generally entitled to legal costs on a partial indemnity basis, which is often 40%-60% of your legal costs. However, Rule 49 can significantly alter the costs awarded at trial.
For example, if you make a Rule 49 offer that is not accepted by the defendant and you subsequently obtain a judgment that is as favourable as or more favourable than your offer, you may be entitled to partial indemnity costs up to the date of the offer, and substantial indemnity costs (75%-90% of your costs) thereafter. This can significantly increase the amount of your legal costs that can be recovered from the defendant.
Rule 49 can also operate against a plaintiff. If the defendant makes a Rule 49 offer that you reject and you subsequently obtain a judgment that is as favourable as or less favourable than the defendant’s offer, then you may recover your costs on a partial indemnity basis up to the date of the Rule 49 offer, but will have to pay the defendant their costs on a substantial indemnity basis from the date of the Rule 49 offer thereafter.
The worst possible outcome is if the defendant made a Rule 49 offer and you fail to recover damages at trial. In this case, you will likely be responsible for paying the defendant’s costs on a partial indemnity basis up to the date of the offer, and their costs on a substantial indemnity basis through to trial.
Note that in addition to potentially having to pay the other side’s legal fees, the unsuccessful party will also be responsible for paying the costs of their own lawyer. For plaintiffs, this is usually not a concern as lawyers operate under a contingency fee arrangement where costs are not charged unless you successfully recover damages.
However, unsuccessful plaintiffs will still be responsible for the other side’s legal fees, which, following a lengthy trial, could potentially amount to hundreds of thousands of dollars.
Given the significant cost consequences that can result from proceeding to trial, it is imperative to retain an experienced personal injury lawyer who can assist you in determining whether the defendant has made a reasonable offer and as well advise you of the risks in proceeding to trial where such an offer has been made.
Do I Have to Accept an Insurance Company’s Offer?
No. The decision whether to accept or reject a settlement offer is ultimately yours. Your lawyer will advise you whether an offer is reasonable and explain the risks of accepting or rejecting it, but the final decision is yours. You may also present a counteroffer and continue settlement discussions in an effort to have the insurance company increase its offer.
If, however, the insurance company makes a final offer, you will have the option to accept it or reject it. If you reject the offer and proceed to trial, certain cost consequences may apply depending on whether you are successful at trial or not, as described above.
Can I Change My Mind After Accepting a Settlement?
No, absent extremely rare circumstances. Once you have agreed to accept the unambiguous terms of an offer, whether it be informally such as verbally or by email, you will be bound by the settlement and will be unable to overturn the settlement. This is why accepting early offers without fully investigating your case may be dangerous.
After you accept an offer, you will then be required to sign a settlement release and a consent form having your case dismissed once the terms of the settlement are satisfied (e.g., you receive the funds from the insurance company).
If you fail to sign a release or agree to have your action dismissed, the defendant may bring a motion to enforce the terms of the settlement and seek their costs of the motion, for which you would be personally responsible.
However, different rules apply to the settlement of an accident benefits claim. You may rescind an accident benefits settlement within two business days if you change your mind. To rescind an accident benefits settlement, you must deliver written notice to your insurer or its representative and return any money received from the settlement.
Frequently Asked Questions
Q. Can I Negotiate an Insurance Company’s Settlement Offer?
A. Yes, you may reject an offer, make a counteroffer, and continue settlement negotiations. However, most individuals are unfamiliar with the types of compensation available in a personal injury claim, the evidence required to support these claims, and the applicable law, while insurance companies regularly handle these claims. This can create a significant imbalance in bargaining positions. An experienced personal injury lawyer can assess the value of your claim, gather the necessary evidence to support your case, and negotiate with the insurance company on your behalf to maximize the value of your settlement.
Q. Can an Insurance Company Withdraw a Settlement Offer?
A. Yes. An insurance company may withdraw a settlement offer before it is accepted. However, the terms of the offer may specify when or how the offer can be withdrawn, and specific rules apply to withdrawal of Rule 49 offers.
Insurance companies may also place deadlines on informal settlement offers to pressure a plaintiff to accept an offer quickly. An experienced personal injury lawyer will consider whether the offer is reasonable based on the evidence and facts of your case rather than simply accepting an offer because of a deadline.
Q. Does Every Personal Injury Case Settle?
A. No. While many personal injury cases settle before trial, some do proceed to trial. This typically occurs where the parties have a significant disagreement over issues in the case such as liability or the value of the plaintiff’s damages.
Settlement allows both parties to avoid the uncertainty and significant expense of a trial.
However, settlement is not always possible. Where an insurance company refuses to make a reasonable offer, proceeding to trial may be necessary.
Q. How Long After Accepting an Offer Will I Receive My Settlement Money?
A. Typically, you will receive your settlement funds 2-3 weeks after accepting an offer and signing a settlement release. However, it may take longer where additional procedural steps are required before the settlement funds can be paid. For example, the settlement monies of a minor plaintiff will typically need to be paid into court until the plaintiff reaches the age of 18. In other cases involving multiple parties and companion lawsuits, there may be significant procedural issues to resolve which may prolong this timeline by several months.
Ava Hillier and Eddie Wiley have successfully represented thousands of individuals in obtaining fair and reasonable settlements. However, we are also committed to proceeding to trial when an insurance company refuses to make a reasonable offer. We prepare every case for trial. This not only puts pressure on insurance companies to make reasonable settlement offers, but also ensures that your case is ready for trial if a reasonable settlement cannot be reached.
Contact Hillier & Hillier at 905-453-8636 for a FREE CONSULTATION or click here to submit an online request for a free consultation.
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