HOW YOUR SETTLEMENT IS DISBURSED……
So your attorney has reached a settlement and has received the check. Now what? Your attorney is required to provide you with a detailed accounting of the disbursement of your settlement funds. The accounting should indicate the initial settlement amount, amount paid to the attorney, and any expenses deducted from the settlement. It should also specify any bills or liens paid on your behalf by the attorney. For example, if the injuries resulted from a car accident case, the doctor who treated you may have a lien, or interest, in the settlement funds, and your attorney is ethically obligated to pay that bill before disbursing the remainder to you.
The attorney works off a contingency fee when they take on your case, which means their fees will come out of the settlement amount from the insurance company. They will take 33.33% if a lawsuit was not filed, but if your case needed litigation, the fee will be 40% of the settlement amount. Additionally, throughout your case, your attorney has paid several costs and expenses upfront regarding your case, such as invoices for a release of medical records, any liens from prior attorneys, and investigation costs that are necessary to pursue your case. A portion of your settlement will also go towards reimbursing your attorney for those expenses that were paid by them, not including their fees. After the fees are paid and expenses reimbursed, the remainder will pay your medical bills that were accumulated as a result of your injuries, and then what’s left will be sent to you by your attorney.
The following chart may help to show how the settlement is divided. Please note this is just an estimated example.