Illinois Law Creates Deadlines for Settlement Checks

A new Illinois law creates a maximum period of time for injury victims to receive their settlement checks, with consequencesfor insurers who do not meet the statutory deadline.

Any injury victim who has been involved in a personal injury case knows that the matter is not over when a settlement is reached or an award is won at trial. The victim must then seek a timely payment. When a trial verdict results in a monetary award, then the negligent party must pay interest on the judgment, until the verdict is paid in full. Until now, this has not been the case for settlement checks.

Some insurance companies drag out the final document preparation and payment process for months with no consequences and no interest owed. In the meantime, while insurers earn interest on the injured party's settlement, the victim continues to suffer the ramifications of lost wages and increased medical bills. The mortgage payment is still due, and the credit card bills still arrive in the mail. SB 1912 helps injury victims, who settled their cases with the responsible parties' insurers, receive their payments in a timely manner.

The new law states that in any civil action involving a claim for money damages (personal injury, wrongful death, or other tortious conduct), the defendant must give the plaintiff (the victim) a release within 14 days of a settlement agreement. The check is due within 21 days after the plaintiff returns the signed release. If court approval of the settlement is required, the plaintiff shall obtain approval and give the defendant a copy of the order approving the settlement, along with the executed release. Defendants and insurers will face consequences if they delay delivering settlement checks. If a check is not delivered within the statutory period, the court, after a hearing, can enter a judgment for the plaintiff on the settlement amount, plus the cost of obtaining the judgment and statutory interest already applicable to judgments. The interest, calculated from the date the settlement documents are given to the defendant, will accrue on the settled amount and will be payable directly to the plaintiff. All interest goes to the plaintiff and is not subject to attorney fees.

The Illinois Trial Lawyers Association supported the creation of this law. Special interest groups opposed it.

  

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