Can My Lawyer Cash My Settlement Check?

Settlement Checks From Personal Injury Claims

When you receive a settlement award in a personal injury case, the insurer will issue a check for the amount owed, typically within 30 days of the final settlement agreement. The check will be issued to your law firm and to you.

Usually, you will need to endorse this check so it can be deposited. This does not apply if you gave your lawyer power of attorney to deposit the check on your behalf. The law firm then deposits your settlement check into a trust account, ensuring your funds are not commingled with law firm funds.

The more you know about the settlement check process, the less frustrating you should find it.

Is It Possible for My Attorney to Cash My Settlement Check?

When your settlement check arrives at your attorney’s office, it will be deposited into a trust account. Your lawyer will then disburse the funds after the check is paid by the insurer’s bank. This could take up to ten business days.

What is the Settlement Check Process for Personal Injury Cases?

Even though you might be eager to receive funds when your personal injury case finally settles, there is a standard timeframe before you can deposit the settlement check.

It takes anywhere from 30 days to six weeks after the completion of negotiations to receive funds. That said, many variables can influence this timeframe. Speak with your lawyer if there is a delay beyond this expected duration.

What Steps Does the Settlement Check Process Follow?

Although there is some variation in the time it takes to receive a settlement check, there is a specific process that unfolds before funds are ready to deposit. This process occurs as follows:

1. Signing of forms: Before settlement funds are released, the at-fault party’s defense attorney will draft a release form. The settlement agreement contains a number of documents, including this release form, which you must sign to receive your settlement. By signing the form, you agree to accept the settlement while releasing all claims against the at-fault party.
2. Insurer processes and releases the settlement check: When the insurer receives these signed release forms, they will process them and send the settlement check to your attorney. The check will usually be sent within 7 to 10 business days, but there are still some further steps before you can deposit the check in your bank.
3. Lawyer deposits check into trust account: When your attorney receives your settlement check, they will deposit it into a trust account until the funds are cleared by the issuing bank. This step is required by law to ensure that the money is in place before the law firm sends you the funds.
4. Debts are paid: Your attorney must pay any liens filed against you, including any unpaid medical bills, previous legal fees, and reimbursements to the insurer.
5. Legal fees and costs are paid: With all debts and liens paid, your attorney then deducts the pre-agreed fees from the total settlement amount. The contingency fee agreement you signed when retaining legal counsel will outline the percentage your attorney will deduct for legal fees.
6. Receiving settlement check: Your lawyer will write you a check for the remaining funds once all fees are paid. This is likely to arrive within six weeks. At this point, you can deposit the funds into your personal account.

Remember: Large Settlements Might Be Handled Differently

All personal injury cases are unique, and some very large settlements might be paid through an annuity. Rather than making a lump-sum payment, the insurer makes regular payments over time.

If this happens, the insurer will send the initial payment to the law firm so it can complete a final accounting. A final accounting ensures that all expenses, medical bills, and legal fees are paid.

You then make an arrangement with your attorney to receive payments directly from the annuity for the duration of the payment period.

Once the final accounting is complete, the law firm no longer has any legal obligation.

Regardless of the type of settlement, things do not always go according to plan with settlement checks.

What Are the Most Common Reasons for Delays with Settlement Checks?

If you have been waiting for six weeks and there is still no sign of a settlement check, it’s time to take action.

The process of receiving a settlement check is already prolonged, so there is no reason for an insurance company to unreasonably delay your payment further.

The following legitimate reasons sometimes result in delays in issuing settlement checks:

• Incorrectly signed release form
• Check still awaiting bank clearance
• Case involves an estate or a minor
• Attorney is still negotiating with creditors and lien holders

If you are unsure why your settlement check is delayed, contact your lawyer. If you did not retain legal counsel, contact the issuing insurance company directly to determine why your check is delayed.

What to Do If Your Attorney Refuses to Give You Copies of the Final Accounting

If your lawyer refuses to give you a copy of the check or the final accounting, this gives you cause for legal action against the law firm.

Fortunately, it is rare for a law firm to mishandle client funds, so this should not become an issue.

Hiring a Personal Injury Attorney

To maximize the settlement you receive in your personal injury case, you should retain an experienced personal injury attorney. They can help you prepare a strong case, deal with the insurer, and file a lawsuit if you fail to agree on a reasonable settlement.

Ask the law firm about its accounting practices and how the final settlement will be handled. The more you know about this process in advance, the less frustrating you will find any potential delays.

If you are unhappy with any element of your initial consultation, look for another lawyer to better represent you.