Personal Injury Claims and Bankruptcy

Out of Control Medical Bills

Personal Injury LawyerDo you have medical bills piling up because someone hurt you in a car wreck and you do not have health insurance? Is the other person’s insurance company stonewalling you while your bills are being sent to collections? Are the harassing phone calls and letters from bill collectors stressing you out and you feel as if you are in a downward spiral? Is bankruptcy an option you should consider?

What Happens to My Injury Claims in Bankruptcy?

DO NOT file bankruptcy for your car wreck related medical bills without talking to an experienced personal injury lawyer first. If you file for bankruptcy, then your claims against the driver that hurt you will become part of the bankruptcy estate and you will lose any chance at a full recovery.  The bankruptcy estate is made up of all of your non-exempt assets that are used by the bankruptcy trustee to pay off part of your debts. Sure, all your medical debts will be discharged, but you will be left starting over with only the exempt assets allowed by your state’s exemption laws.  Many states will only allow you to keep less than $7500 in equity in your car, limited personal possessions, and limited equity in your home.

How Can an Experienced Personal Injury Lawyer Help?

Talk to an experienced personal injury lawyer and find out what your rights are to see if you can be helped. If you hire an injury lawyer, then they should be able to get most, if not all, of your creditors to back off as your claim progresses towards settlement. If you do not have medical insurance, then an experienced personal injury lawyer may be able to get your medical providers to accept a lien against your claim so you can continue to get medical treatment while your claim proceeds towards settlement or trial. Studies show that people who hire a personal injury lawyer receive significantly more money when they settle their claims with insurance companies that people who try to settle their claims on their own. Last, your lawyer can file suit against the other driver and take your case to trial if the insurance company refuses to negotiate in good faith. Hiring a personal injury lawyer lets you focus on getting well and getting back on your feet while your lawyer works with your creditors and stands up to the insurance companies for you.

Bankruptcy Should be the Last Option, Not the First

In rare cases, the at-fault driver may not have adequate insurance and your uninsured/underinsured motorist (UIM) coverage may not pay for enough of your medical bills to allow your creditors to release their claims, as the lawyers at Davis, Johnson and Kallal explain. If this happens and you face aggressive creditors and garnishments, then bankruptcy may be an option for dealing with your medical bills, but again, do not file for bankruptcy without exploring all of your other options with an experienced personal injury lawyer first.