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What is a Contingency Fee and How do they Work?

What is a Contingency Fee and How do they Work?

Personal injury law is a field that encompasses many types of incidents, including car accidents, premises liability, dog bites, workplace injuries, medical malpractice, and more. The purpose of personal injury law is to protect victims who have been injured due to the negligence of others. These people may face high medical bills, lost income from missing work, and other damages that put their financial future at risk.

When a client pursues a personal injury case, they have to prove that another party was responsible for the incident that caused their injury. Sometimes, this pits them against an insurance company or another entity with access to more resources. As a result, the victim can choose to hire a personal injury lawyer to assist with their case.

This is where contingency fees come into play.

What Are Contingency Fees?

For many legal services, lawyers charge an hourly fee. The longer your case goes on, the more the attorney will make. Hourly fees are common in criminal law cases, divorce proceedings, business consultations, family law, and many other legal fields. Other types of legal fees include retainers, flat rates, and statutory.

On the other hand, contingency fee agreements are used when lawyers will only get paid after a successful outcome for the case. A personal injury lawyer accepts a contingency fee once a settlement has been reached. Let’s take a look at what a contingency fee agreement might look like in a particular case.

Contingency Fee Agreement for a Personal Injury Case

There are a lot of fees associated with legal costs. For personal injury cases, there are filing fees. If the claim proceeds to court, there may be witness fees, court filing fees, and litigation costs even in civil cases. Other legal fields may result in discovery costs or postage costs that parties may need to pay after the case settles. The various fees often determine what type of fee arrangements will be made with clients.

When you sign a contingency fee agreement with your personal injury lawyer, it is likely for a certain percentage of the settlement amount. That payment is contingent upon successfully earning compensation for you as the client. However, it should be noted that many law firms will still require you to pay for some of the costs associated with the case even if you lose.

Additionally, more experienced lawyers may charge a higher contingency fee percentage in the event of a successful claim. The type of case may also dictate whether a lower percentage or a higher percentage will be paid to the attorney. It also ensures that an attorney is highly motivated to win the case for their client, as they will get paid more money from the agreed-upon percentage if you win.

What to Know About Contingency Fee Agreements

If you are in the process of searching for an injury attorney and entering into a contingency fee agreement, then there are a few things that you should know.

First, and most importantly, make sure that you read the entirety of any fee agreements before you sign. You must understand what the terms of the contract are and how the contingency fee arrangement will work. Make sure you are clear on what the attorney fees are, what other costs might be included in the lawyer’s fee, and whether or not it is a fixed percentage.

Although contingency fee arrangements are designed to help victims, especially those with lower incomes, pay for legal services, there is still risk involved if you lose the case.

Additionally, you should know that the attorney’s fees are paid first in the event of a settlement. This is also true about other damages like medical costs. When you win a personal injury claim, you don’t receive compensation until damages are covered and contingency fees are paid. This is true of almost every contingency fee arrangement, as the lawyer agrees to be paid for their services if successful.

How Personal Injury Lawyers Can Help

If you decide to pursue a personal injury claim without a lawyer, you will miss out on several benefits. Agreeing on a contingency fee arrangement with your attorney will give you a better chance of winning the case.

Assessing Damages

After the incident that caused your injury, you could experience damages like medical bills, lost wages, funeral costs for a family member, or even emotional suffering. A lawyer can help assess the level of damages accrued to determine how much monetary compensation you deserve.

This could include looking at medical records, insurance bills, and pay stubs.

Compiling Evidence

The most important element in a personal injury claim is proving negligence on the part of the responsible person or entity. If you have a complicated case, it could be difficult to provide enough evidence for monetary recovery. The legal work needed to win such cases is best handled by professional injury attorneys.

They understand what evidence will strengthen your claim.

Professional Conduct

Filing a claim can be intimidating. You may be going up against insurance companies with far more resources and knowledge about the law. An attorney agrees to provide you with legal representation so that there is a level playing field. Whether you are involved in wage dispute cases or are an injured victim, attorneys will give you the best chance of success.

A lawyer understands the procedures for delivering documents, filing claims, sharing evidence, and more.

How Lawyers Being Paid on a Contingency Fee Basis Helps You

If you, as the client, feel confident that you have a strong case for your personal injury claim, then contingency fees are a great type of contract to sign with your attorney. First, it guarantees that you will have legal assistance from a professional law firm and better access to their services. Second, they are used to handling certain cases with similar fee structures. Third, you know that they will guide you through the legal procedures from the first meeting to the final settlement.

Time spent on your case is irrelevant with a contingency fee percentage plan, unlike an hourly rate.

Contact legal representation for your injury claim today to discuss a contingency fee agreement that will give you a great chance of winning compensation for your damages.

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