Quick Answer
If you’ve watched TV or driven down a highway over the past 30 years, you’ve probably seen a commercial or billboard for a personal injury lawyer that promises “You’ll Only Pay if You Win.” They’re mostly telling you the truth. But they’re also leaving out important details about what winning means and how much you’ll get if you do.
Many personal injury lawyers only want you to think about how much you'll get from your total settlement (i.e. the number you see highlighted on the billboard). Just as importantly, you should ask what you'll actually take home, what you'll be charged for along the way, and what the lawyer will actually do for you. To understand that, you need to understand the way personal injury lawyers talk. Even everyday words like "cost" can mean something different in a legal context than they do in a grocery store. Here are a few key terms you need to know:
Contingency Fee: A contingency fee is a set percentage of a case settlement that is paid to your lawyer after your case settles. The personal injury industry norm for cases that do not involve a lawsuit is 33.3% and for those that do include a lawsuit, the norm is a 40% fee.
Why aren’t injury lawyers paid upfront? 56% of Americans have less than $1000 saved for an emergency. This is the very emergency the statistic is talking about. People in their time of need can’t afford to pay an attorney and contingency allows clients to defer payment until the end. Contingency is pro-justice, if administered fairly.
Case Costs: In a personal injury case, case costs are different from the fee you pay your lawyer, which is usually called the legal fee. Case costs refer to the expenses paid by your lawyer or their firm related to your case, including investigations, negotiations, and lawsuits. If your case settles, you're responsible for repaying these costs out of your portion of the settlement. Some costs are unavoidable, like lawsuit filing fees if your case requires one. But sometimes personal injury lawyers pass along costs that deserve some scrutiny, like reimbursing them for photocopying or a $0.50 stamp.
Total (or Gross) Settlement: The total settlement is the amount of money the insurance company pays to settle your case. It's the number billboards like to cite, because it's the biggest of all the numbers. Personal injury lawyers are paid their fee out of this pot of money, before it's used to pay your medical bills, other case expenses, or reach your wallet.
Net Settlement (your share of the settlement): Your net settlement is the amount of money left from your total settlement after costs are paid — including medical bills, financing costs, case costs, lienholders, and the lawyer's contingency fee.
Retainer Agreement: Hiring a personal injury lawyer is serious business. So much so that you should treat it like a business decision and ask to review your agreement with your law firm, called the Retainer (or Engagement), in writing before signing. If you meet with a lawyer who’s dodgy about delivering a draft, you should keep looking. And if the draft you receive is full of legal jargon, ask for it to be explained in plain language. Why? Because you should never feel pressure to sign something you do not understand.
Your Retainer agreement should clearly outline:
- Lawyer’s fee with a lawsuit
- Lawyer’s fee without a lawsuit
- Any time period for you to change your mind without penalty
- The services they’re agreeing to provide for the fee you’re paying
Settlement Statement: A breakdown of your settlement and all of the expenses of your case that will get paid before you get paid. You’ll usually get a Settlement Statement at the end of your case (good firms will talk about Settlement Statements the whole time and even show you how yours is changing as your case goes on). The below is a table showing many of the key elements of a settlement statement, although you can expect the lawyers’ version to not look as nice.
Or, Skip the Contingency Fee Entirely:
Most of these definitions exist because personal injury claims have traditionally been handled through contingency-fee lawyers. But that's not the only option anymore.
Mighty's AI handles your claim without taking a percentage of your settlement. There's no contingency fee, no case costs reimbursement, no settlement statement showing 33%-40% of your settlement going to the lawyer. Mighty's AI builds your case file, opens your claim with the insurance company, negotiates a settlement for you to approve, and routes you your payment if the offer is fair. For most accident claims, that's all you need — and you keep 100% of your settlement.
For cases that genuinely need a lawyer — serious injuries, disputed liability, multiple parties, or an insurance company refusing to engage — Mighty's marketplace surfaces a vetted lawyer paid only on the increase to your existing offer, not 33%-40% of the entire settlement.
Know Your Claim’s Worth—and Settle It
Serious injury or no injury at all, move your case forward instantly from your phone.
Thank you for submitting your information.
About the author
Luke is a warm-hearted and highly skilled legal operations expert with an impressive 8-year track record in the personal injury field. As the Client Operations Lead at Mighty, he is dedicated to providing exceptional support, transparent communication, and genuine empathy to clients during their challenging journey. His expertise in streamlining processes and implementing cutting-edge technology makes him an indispensable ally for clients, case managers, and attorneys in their pursuit of justice.
