We often hear from clients that they didn’t seek out legal representation or hesitated to contact a lawyer for a previous accident because they were worried that they wouldn’t be able to afford a personal injury lawyer.

It’s easy to see why accident victims may balk at the idea of spending more money when they have medical bills and repair bills piling up after an accident.

However, these worries are largely misplaced and stem from a confusion about the different fee structures that lawyers use. Some arrangements require clients to pay up front or as they go. But another—contingency fee, which we use exclusively—allows injury victims to get the legal representation they need without paying anything up front or out of pocket.

How Lawyers Get Paid

Depending on the type of legal services you’re seeking, you may run across any one of these three primary fee arrangements:

• hourly rate,
• fixed fee, or
• contingency fee.

The first two fee arrangements are more or less self-explanatory.

Hourly Rate Arrangements

When you work with a lawyer on an hourly rate fee structure, you typically pay monthly bills, which are dependent on the billable hours and the hourly rates. In this fee arrangement, it can be difficult for clients to estimate the total cost because there are number of mitigating factors:

• Hourly rates vary by attorney. A firm’s senior partner who has 20-years’ experience will likely charge more than a younger, less-experienced associate attorney.
• Hourly rates vary by specialty. An estate planning attorney, real estate attorney, and criminal defense attorney with the same seniority level and years of experience may charge different hourly rates.
• Multiple people bill for each case. A senior partner, associate attorney, and a paralegal may work on a case at the same time, and all of these will add hours to the total bill.

Fixed Fee Arrangements

Fixed fee arrangements disclose the total costs for the legal services up front, which is great for budgeting purposes. But you are typically required to pay the full fee up front as well.

However, fixed fee arrangements are only viable when the scope of the legal services can be precisely defined (e.g. drafting a last will and testament), which is why relatively few attorneys offer fixed fee arrangements.

Contingency Fee Arrangements

Contingency fees are the third widely used payment arrangement. Most personal injury lawyers, including us, exclusively bill on a contingency fee basis.

When you hire a lawyer on a contingency fee basis, your lawyer will receive a percentage of the money you win in your case to cover their legal services. Basically, this means that clients are not charged attorneys’ fees unless they recover money—either from a settlement, judgment, or jury verdict.

While riskier for the lawyers, contingency fees benefit injured clients. They remove the financial barriers imposed by a fixed fees or hourly rates, both of which could disincentivize seriously injured parties from seeking the legal help and monetary recovery they deserve.

Contingency Fee Amounts

Most states regulate the size and scope of contingency fees. This is to protect clients from over-the-top charges by less-than-honest lawyers.

Pro Tip: Not all lawyers are honest. For example, in November 2020 federal authorities indicted a personal injury attorney from New Orleans for a massive crash staging scheme. Even though lawyers like this are a small minority, you need to be careful who you do business with! Before hiring someone, check out a lawyer’s website, personal info, blog posts, and reviews to make sure they’re the right person for the job.

The Florida Bar Rules of Professional Conduct limit the contingency fee amounts here in Florida. Lawyers can be compensated:

• 33.3% of the first $1 million recovered before a lawsuit is filed, and
• 40% of the first $1 million recovered after a lawsuit is filed.

Additionally, the percentages change for amounts awarded above the $1-million mark for both pre- and post-litigation recoveries. Lawyers can also receive:

• 30% of the recovery between $1 million and $2 million, and
• 20% of the recovery above $2 million.

The percentages for amounts in excess of $1 million apply only to those portions specifically. In other words, in a hypothetical $2.5 million settlement, a lawyer will receive 33.3% of the first $1 million, 30% of the second $1 million, and 20% of the final $500,000. Do note, though, that damages in the vast majority of personal injury cases will not exceed $1 million.

Pro Tip: Your lawyer may agree to a lower percentage than what is listed here, but not a higher one. Percentages above these are considered “clearly excessive.” A court must explicitly grant permission for a lawyer to charge a higher fee.

Regardless of the total amount of damages, because the fees are contingent on your monetary recovery, your personal injury lawyer has a tremendous incentive to work hard on your case and obtain a favorable settlement or jury verdict.

Why So High?

A 30–40% contingency fee seems high to some clients. However, it’s important to remember a couple of things that will alleviate this uneasiness.

First, even though it’s natural to think of it as a lawyer taking money away from you, this isn’t exactly right. Remember, without the lawyer’s intervention on your behalf, you would have recovered nothing. So, it’s good to flip the framing and see it as your lawyer won you 60%–70% more money than you would have gotten without a lawyer.

Second, clients are not involved in the majority of the work required to handle their cases. On the one hand, this means that clients do not personally have to file briefs, take depositions, and negotiate with insurance companies. They are free to focus on recovering emotionally and physically from their injuries.

On the other hand, since clients won’t personally have to file briefs, take depositions, and negotiate with insurance companies—their lawyers will—they can lose sight of just how time-consuming and mentally-taxing these activities can be. Most of a lawyer’s efforts to investigate, prepare, negotiate, and manage a client’s case happen when the client isn’t in the office.

To flesh this out a bit more, let’s look at some numbers. According to a 2013 study by the Court Statistics Project, litigating an average car accident case required 196 hours of attorney time and an average malpractice case required 472 hours.

For perspective, assuming a conservative hourly billing rate, let’s say $300, that 196 hours would cost a client $58,000 out of pocket—regardless of the outcome of the case!

Finally, personal injury lawyers ensure that the bills and expenses you incurred as a result of your injury are paid. We can also negotiate the amounts you owe to medical providers, so you don’t have to spend as much of your total recovery paying off medical bills.

Pro Tip: This is why we offer free case evaluations to potential all clients. It’s essential that we review the general aspects of your case and discuss your legal options up front so that you can decide if we are the firm for you, and we can decide whether your case has merit.

Seize the Benefits of Legal Representation

If you are here, chances are that you or someone you know has been injured in an accident. We are truly sorry that you are going through this, and we sincerely hope that you recover from your injuries and that you can return to your normal life as soon as possible.

But in the meantime, make sure that you hire a qualified personal injury lawyer to represent you and protect your rights. Victims who don’t have a dedicated personal injury lawyer on their side often don’t recover the full amount of damages to which they are entitled.

Insurance companies may already be peppering you with emails and phone calls trying to force a low-ball settlement. The insurance company has attorneys and adjusters on their side to protect their interests—so should you.

The personal injury lawyers here at Personal Injury & Accident Law Center would love to speak to you about your case and tell you how we can help you get on the path to a full recovery. Call us today at (561)372-3800 to schedule a free case evaluation or fill out the confidential form below and a team member will contact you soon.