Pre-Settlement Funding: Handling Expenses before Settling an Injury Claim

Pre-settlement funding – or lawsuit advance funding – can help injury victims make ends meet before a personal injury claim is settled. Many victims are unable to work after the accident and can face mounting medical bills, not to mention other bills and basic living expenses that don’t stop if out of work while recovering from an injury.

Advances and one’s own insurance coverage can help take care of many of these expenses, and injury victims can go over these options with an injury attorney in Colorado.

Pre-settlement Funding through Cash Advances

Companies offering pre-settlement loans (although not technically classified as such) do so by estimating the potential value of the claim settlement and providing the plaintiff with a cash advance that allows him or her to handle expenses before settling.

The plaintiff then pays back the company upon settlement, but is not obligated to pay back the loan if he or she does not recover compensation. Further, the amount the plaintiff must pay back will not exceed his or her portion of the settlement award.

Pre-settlement Funding to Pay Medical Bills through Health Insurance

Usually the most significant expenses after an accident are related to medical care and treatment. Although it would be nice to get these bills taken care of right away by settling the claim as soon as possible, it’s not a process that should be rushed.

In fact, a personal injury claim shouldn’t be settled until the injured person is completely sure of the diagnosis and prognosis. Long-term or disabling injuries may impact an individual for months and even years. It will be important to take this into account when negotiating a settlement.

One option for lawsuit advance funding for handling medical expenses is for the injured person to go through their own health insurance. Of course, this could mean having to come up with the money for co-pays or deductibles.

Once the claim has been settled, the health insurer may collect from the settlement once it is reached to reimburse for any treatment costs.

Another option for pre-settlement funding to handle medical expenses is through medical payments coverage in a car insurance policy. Medical payments coverage is not required in Colorado, but can take care of expenses related to a hospital stay, X-rays, medications, and more, up to the limits of the policy.

Negotiating a Claim Settlement with Help from an Injury Attorney in Colorado

In addition to easing the financial burden through lawsuit advance funding, there are ways to make the process of settling a claim somewhat easier; for instance, knowing ahead of time the claim’s value can ensure you pursue proper compensation.

This requires not only figuring out actual current costs, but additional compensation that an injured person might be entitled to receive.

Examples of damages that may be included in a personal injury claim are:


  • future medical expenses;
  • lost wages;
  • pain and suffering;


  • disability; and
  • emotional anguish.

The insurance company is typically inclined to offer below the real claim value, so working with an injury attorney in Colorado can be very helpful to accident victims in Arvada. Accident victims can even discuss sources of pre-settlement funding with their attorney.

D.J. Banovitz’ career has always concentrated on trial practice and he has litigated hundreds of cases. His passion and sole career focus has been to seek justice for people suffering from personal injuries as the result of someone else’s negligence. The hallmark of the Law Office of D.J. Banovitz, is the total commitment to professionalism, quality, and personalized care of your injury case. D.J. has dedicated his professional life to helping those most in need and is a proud and active member of the Colorado Trial Lawyers Association. His experience includes volunteering for Colorado Rural Legal Services in Montrose, the Colorado Aids Project, consumer law, family law, criminal defense, and Alternative Defense Counsel for juveniles in Denver.