Reputable personal injury lawyers are upfront about money. Still, many people are surprised by how much comes out of a settlement before they receive their share. Most “hidden” fees aren’t hidden. They’re in the agreement, or they’re liens people didn’t know about. Here’s how to avoid surprises.
Read the fee agreement before you sign
Most states require contingency agreements in personal injury cases to be in writing. Before signing, make sure it clearly states:
- The fee percentage at each stage (pre-suit, after filing, trial, appeal)
- Whether the fee is calculated before or after costs
- Which expenses count as costs
- Who pays costs if there’s no recovery
- Whether there are any administrative or file fees
- What happens to the fee if you change lawyers
If anything is unclear, ask for it to be explained or rewritten. See attorney fees vs. case costs.
Watch for these extras
- Administrative or “file” fees: flat charges for office expenses. Ask if they apply.
- Interest on costs advanced: some firms charge interest on money they front. Ask.
- Fee increases you didn’t expect: know exactly what triggers a higher percentage.
- Lawsuit loans: pre-settlement funding companies can charge very high rates. Avoid them if you can, and talk to your lawyer first.
Understand medical liens early
When a health insurer, hospital, Medicare, Medicaid or workers’ comp pays for your treatment, they often have a right to be repaid from your settlement. This is called a lien or a subrogation claim.
- Ask your lawyer early who has paid for your care and who may claim repayment.
- Ask whether your lawyer will try to negotiate liens down. Many do, and it can make a big difference.
- Don’t ignore letters from insurers about “subrogation.” Share them with your lawyer.
Get an itemized settlement statement
Before you receive money, your lawyer should give you a written settlement (or closing) statement showing:
- The gross settlement
- The attorney fee and how it was calculated
- Each case cost, itemized
- Each lien and the amount paid
- Your net amount
Review it carefully and ask about anything you don’t understand before signing.
Questions to ask about money
- What’s your fee at each stage?
- Is the fee calculated before or after costs?
- Do you charge any administrative fees or interest?
- Who pays costs if we lose?
- Who might have liens on my settlement?
- Will you negotiate liens?
- Will I get an itemized settlement statement?
Printable money checklist
- Written fee agreement with percentages at each stage
- I know whether the fee is calculated before or after costs
- I know who pays costs if we lose
- No unexpected admin fees or interest, or I understand them
- I know which insurers or programs may have liens
- I’ll get an itemized settlement statement before paying out
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Frequently asked questions
What's a reasonable contingency fee?
Commonly about one-third before a lawsuit and up to around 40% if the case goes to litigation, though it varies. See how contingency fees work.
Can my health insurance take part of my settlement?
Often yes, if it paid for accident-related treatment and your plan or state law gives it a right to repayment. Your lawyer can review the claim and may negotiate it down.
What if I think I was overcharged?
Ask your lawyer for a full explanation and itemization. If you're still concerned, many state bars offer fee dispute programs.
Should I take a lawsuit loan while I wait?
Be cautious. These advances can carry very high costs that reduce your recovery. Talk to your lawyer about alternatives first.
This guide is general information, not legal advice. Laws change and every case is different. Talk to a licensed attorney about your situation.