Claim vs. Lawsuit

The terms claim and lawsuit are often used synonymously, but they have different meanings. To complicate matters, the word claim has two separate uses.

What is a Claim?

A claim occurs when another person’s wrongful actions injure you. You request that the at-fault party pay you compensation for the injuries and related financial losses you’ve suffered. The term’s exact meaning depends on whether or not litigation has been initiated.

If another party injured you due to negligence, you likely have a “claim” against them for your damages related to the accident. In many cases, such as car accidents, slip and falls, or other injuries on someone’s property, you might file your claim with the at-fault party’s insurance company.

The insurance company will investigate your claim to determine whether their insured is at fault. If they are, the insurance company will propose a settlement offer to compensate you for your injuries and damages.

Claim in Litigation

Most claims filed with an at-fault party’s insurance company are resolved without court intervention. However, what if an at-fault party’s insurance company is unreasonable and refuses to pay you fair compensation? Then you have to determine whether to sue them (their insurance company will normally defend them).

If you do decide to sue the defendant, then you file a lawsuit. Specifically, you file a petition with the court. This petition contains one or more claims. Each claim in the litigation contains “(1) a short and plain statement of the facts showing that the pleader is entitled to relief and (2) a demand for judgment for the relief to which the pleader claims to be entitled.”

What’s a Lawsuit?

A lawsuit is a legal process in which a court hears and adjudicates the claims in your petition. 

It can take years and consists of many steps, including:

  • Petition. This is the legal document you file to begin the lawsuit. It outlines what the defendant did wrong and what damages you seek for your injuries.
  • Answer. The defendant responds to the claims in the petition, usually denying all allegations.
  • Motions. During the lawsuit, many motions will be filed. These include motions to dismiss the case, change the court, or allow or exclude evidence.
  • Information exchange. To practically proceed with a lawsuit, both sides need information from the other. The process of collecting this information is called discovery. It consists of interrogatories (written questions), the production of documents, and depositions (questions under oath). Physical or medical exams may also be possible.
  • Alternative dispute resolution. Courts are heavily burdened. Public policy encourages the parties to resolve their disputes in an alternative manner. Several possibilities for pre-trial settlement include informal discussions and court-mandated settlement talks. Another common method is mediation, where the parties meet to try and resolve their disputes in a relatively informal setting. Finally, there is arbitration, a more formal process that can result in a decision binding on all parties.
  • Trial. A trial consists of jury selection, opening statements, the introduction of testimony and exhibits, and closing arguments. Then the judge instructs the jury, and the parties await a verdict, which can take a few minutes or several days.

After the jury verdict, if one side is dissatisfied with the result, post-judgment motions for reconsideration and appeals are possible.

Benefits and Disadvantages of Claims vs. Lawsuits

There are many pros to filing a claim rather than a lawsuit:

  • No court costs
  • Fewer or no attorney fees
  • Quicker payment.

However, there are also cons to a pre-litigation claim. They revolve around dealing with an insurance company, which does not have your best interest in mind. Insurance companies are businesses – they are mindful of their bottom line. Also, they decide the compensation they will pay.

Filing a lawsuit has the advantage that a neutral court will adjudicate your claim. You’ll also probably receive more compensation because the amount is up to a jury, not the insurance company. Of course, the disadvantages are the additional time and money that a lawsuit involves. These can be particularly significant if you have mounting medical bills and your financial situation is deteriorating while you wait years for a favorable jury verdict.

Regardless of whether you file a pre-litigation claim or a claim as part of a petition in a lawsuit, the desired outcome is the same: compensation for the costs and pain and suffering associated with your injury. Our personal injury lawyer at the Bradley Law Firm is ready to work on your behalf – whether dealing with an unsympathetic insurance company or a neutral court.