If you’ve been injured in an accident, you may hear your attorney mention sending a demand letter and wonder what that actually means for your case. A demand letter is one of the most important early steps in a personal injury claim. It formally presents your case to the insurance company and sets the stage for settlement negotiations.
At Northern Plains Justice, demand letters are not generic documents. They are carefully crafted legal position statements designed to explain who is at fault, why the insurance company is responsible, and how much compensation is required to fully resolve the claim.
What Is a Demand Letter?
A demand letter is a written presentation of your personal injury claim sent to the at-fault party’s insurance company (or their attorney). Its purpose is to clearly and persuasively explain:
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How the accident happened
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Why their insured is legally responsible
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The nature and severity of your injuries
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The full financial and personal impact of those injuries
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The amount of compensation being demanded to settle the case
In short, it tells the insurance company: this is the case, this is the evidence, and this is what it will cost to resolve it without litigation.
Demand letters are usually sent as written letters or emails, though in complex or high-value cases, attorneys may also use formal settlement packages or presentation-style demands.
When Are Demand Letters Used?
Demand letters are most commonly used in cases involving:
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Pedestrian and bicycle injuries
In more complex cases—such as medical malpractice or aviation accidents—a lawsuit may already be filed before a formal demand is made. In those situations, the demand is often sent directly to defense counsel rather than an insurance adjuster.
What Information Is Included in a Demand Letter?
A properly prepared demand letter is detailed, evidence-based, and strategic. It typically includes:
Liability Analysis
A clear explanation of how the accident occurred and why the other party is legally at fault under South Dakota law.
Injury Summary
A comprehensive overview of your injuries, including diagnoses, treatment, and prognosis.
Medical Documentation
Relevant medical records, imaging reports, and treatment timelines supporting the injury claims.
Damages Breakdown
An explanation of economic and non-economic damages, such as:
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Pain and suffering
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Permanent impairment or disability
Settlement Demand
A specific dollar amount requested to resolve the claim before litigation.
How Long Does It Take to Get a Response?
Once an insurance company receives a demand letter, it typically takes several weeks to a month to respond. In some cases, it may take longer if:
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Medical records are still being reviewed
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The insurer requests additional documentation
When the response does arrive, the initial offer is almost always low—often lower than the total medical bills. This is a standard insurance tactic and not an indication of the true value of the case.
Your attorney anticipates this and uses the demand as a starting point for negotiation, not the finish line.
When Is the Right Time to Send a Demand Letter?
Timing is critical. Sending a demand letter at the wrong moment can significantly affect the outcome of your case.
The Risk of Settling Too Early
Settling too early can be a costly mistake, especially in serious injury cases. In truck accident claims, for example, trucking companies may push for a fast settlement to avoid deeper investigation.
Early settlement can prevent important facts from coming to light, such as:
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Driver safety violations
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Prior crashes or disciplinary history
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Hours-of-service violations
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Failed drug or alcohol tests
Once a settlement is signed, you typically give up the right to pursue additional compensation—even if new evidence later emerges.
The Risk of Waiting Too Long
Waiting too long can also create problems. Your attorney evaluates several factors when determining the right timing:
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Clear liability or disputed fault
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The severity and permanence of injuries
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Current and future medical costs
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Available insurance coverage
In some cases, policy limits may be insufficient to cover long-term medical needs. If medical bills continue to grow beyond available coverage, a settlement may end up being consumed by liens and unpaid expenses rather than benefiting the injured person.
Strategic timing helps protect your financial recovery—not just the size of the settlement on paper.
What Happens After the Insurance Company Responds?
After the insurer responds to the demand letter, negotiations typically begin. This may involve:
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Counteroffers
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Requests for clarification or additional records
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Mediation or informal settlement discussions
Insurance companies often increase their offers as litigation approaches, especially when faced with strong evidence and the risk of trial.
What If the Insurance Company’s Best Offer Isn’t Fair?
If the insurer refuses to make a reasonable offer, your attorney moves the case forward into litigation. This includes:
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Filing a lawsuit
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Conducting discovery
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Taking depositions
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Consulting expert witnesses
While the majority of personal injury cases settle before trial, attorneys prepare every case as if it will be tried. That preparation is often what drives meaningful settlement offers.
Statistically, only a small percentage of personal injury cases reach trial, but the willingness and ability to go to trial is what gives your case leverage.
Why Demand Letters Matter
A well-prepared demand letter does more than ask for money. It:
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Frames the narrative of the case
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Demonstrates preparedness and credibility
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Signals whether litigation is likely
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Influences how seriously the insurer evaluates the claim
For insurance companies, a strong demand letter backed by evidence is often the difference between a dismissed claim and a meaningful settlement.
How Northern Plains Justice Approaches Demand Letters
At Northern Plains Justice, demand letters are not rushed or generic. They are built after careful evaluation of:
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Medical records and future care needs
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Insurance coverage limits
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Long-term financial impact on the client
The goal is not a quick settlement—it’s a smart, informed resolution that protects your future.
