What is a Personal Injury Settlement Release?

Jerry Bowman, Owner and Managing Attorney

General
November 1, 2023
What is a Personal Injury Settlement Release?

When pursuing a personal injury claim, one critical aspect that claimants must navigate is the settlement release. A settlement release serves as a legal contract that finalizes the resolution of a personal injury case. In Colorado, understanding the significance of a settlement release is vital for those seeking compensation for their injuries. This article aims to shed light on the concept of settlement releases in personal injury claims, clarifying key questions and providing essential information for individuals navigating this process.

What is a Settlement Release in a Personal Injury Case?

A settlement release, also known as a release of all claims, is a legal document that outlines the terms and conditions of the settlement agreement between the injured party (the claimant) and the party responsible for the injury (the tortfeasor). This agreement signifies the claimant’s acceptance of a specified payment amount from the tortfeasor or their insurance company in exchange for releasing them from any further liability related to the incident. By signing the settlement release, the claimant agrees to relinquish their right to pursue any additional claims or legal action against the tortfeasor regarding the specific injury.

Am I required to Sign a Settlement Release in a Personal Injury Case?

While signing a settlement release is not mandatory in all personal injury cases, it is commonly a requirement for receiving compensation. In many instances, insurance companies or responsible parties will insist on a settlement release as a condition for making payment to the claimant. By doing so, they ensure that once the settlement amount is paid, they are released from any further financial obligation or potential legal consequences arising from the incident.

What Happens After Signing a Settlement Release

Once you sign a settlement release, it becomes a binding contract between you, the claimant, and the responsible party or their insurance company. Signing the release typically results in the closure of your personal injury claim with the designated tortfeasor, and it marks the conclusion of your legal pursuit for further compensation regarding that specific injury. Consequently, you will no longer have the right to seek additional damages or pursue legal action against the responsible party or their insurer related to the incident covered by the settlement release.

It is important to know that if there are multiple tortfeasors, you may have claims against each individual tortfeasor. When you have reached a resolution with one tortfeasor, it is very important to be sure that you are only releasing that tortfeasor and their insurer from any further liability related to your losses.  

What Should I be Aware of Before I Sign a Settlement Release in a Personal Injury Case?

Before signing a settlement release, it is crucial to consider several important factors:

  • Terms: Carefully read and understand all the provisions within the settlement release. Ensure that the document encompasses all aspects of the settlement, including the payment amount, release of liability, and any other relevant terms.
  • Consult with an Attorney: It may be beneficial for you to seek legal advice from a personal injury lawyer who can review the settlement release and ensure it adequately protects your rights and interests.
  • Assess the Extent of Your Injuries: You should always take into account the current and potential future consequences of your injuries when evaluating the timing and amount of any settlement offer. You should consider any medical expenses, any lost wages, your pain and suffering, and any ongoing treatments or rehabilitation needs you have before entering into a settlement release. If you have questions or concerns about the amount, you should not sign the settlement release. 

Can I Negotiate if the Insurance Company Sends a Settlement Release?

It depends but oftentimes, yes. Even if the insurance company sends you a settlement release, negotiation is still possible. Remember, the initial settlement offer is often just a starting point for negotiations. You have the right to counteroffer or request adjustments to the settlement terms. Engaging in discussions with the insurance company or the responsible party’s representatives can potentially lead to a fair compromise that better reflects the extent of your injuries and the associated damages.

You should keep in mind that after you have accepted the settlement offer from the insurance company, the settlement release should include the terms contemplated at the time you accepted the offer. If the insurance company attempts to assert any additional terms, such as confidentiality, liquidated damages, etc., the insurance company has modified the agreement and you should contact them to have these additional terms removed from the settlement agreement. 

When Should I Sign a Settlement Release in a Personal Injury Case?

The timing of signing a settlement release is a crucial decision that should not be taken lightly. It is advisable to consult with a personal injury lawyer to determine the most appropriate time to sign, considering the following factors:

  • Complete Understanding of Your Injuries: Ensure you have a comprehensive understanding of the full extent of your injuries, including any potential long-term or 
  • future complications.
  • Adequate Medical Treatment and Evaluation: It is essential to receive proper medical treatment and evaluations to determine the complete scope of your injuries and their impact on your life.
  • Thorough Evaluation of the Settlement Offer: Evaluate the settlement offer carefully, considering its fairness and adequacy in covering your current and future damages.

Consult Bowman Law to Discuss Settling your Personal Injury Case

Settlement releases play a critical role in resolving personal injury claims in Colorado. Understanding the purpose, implications, and negotiation possibilities associated with settlement releases is crucial for claimants seeking compensation. By being aware of their rights, consulting with legal professionals, and conducting thorough evaluations, individuals can make informed decisions when navigating the process of signing a settlement release. 

Remember, seeking professional guidance ensures that your interests are protected throughout the settlement process, providing you with the best opportunity for a fair and just resolution to your personal injury claim. The attorneys at Bowman Law are experienced in settlement negotiations and will fight to make sure you receive the fairest settlement with the fairest terms. 


Schedule a free consultation to speak to one of our personal injury attorneys about your claim. Our office is located in Denver and we serve Colorado Springs, Boulder, Fort Collins, Aurora, and the surrounding areas.