What Should You Know About Letters Of Protection In Personal Injury Claims?

If you've been embroiled in a personal injury lawsuit for months or more, your case may be getting close to the point at which a settlement offer is being extended. It can be tempting to settle your claim now rather than risk a negative result at trial. If your case is governed by an attorney's letter of protection (LOP) to a medical provider, there are some additional factors you'll need to consider before saying yes or no to a settlement offer. Read on to learn more about LOPs and how the existence of one in your case could impact the amount and structure of your final settlement or judgment.

What is an LOP?

An LOP is simply the term used for a letter sent to a medical provider by an attorney promising to pay the provider's fees out of any proceeds of a personal injury settlement. For example, if you're injured in an auto accident that is clearly the other driver's fault and incur emergency medical bills, you may be able to get by without paying these bills for months or even years (with no damage to your credit) by having your attorney issue an LOP to the hospital or doctor.

Attorneys have an ethical obligation to abide by their own agreements made on behalf of the client, and must advise clients of this obligation as well. Although an attorney can't control a client's actions, he or she must take all reasonable efforts to ensure the client complies with the provisions of the LOP (for example, ensuring the client doesn't attempt to make payments to the medical provider outside the scope of the personal injury process). 

How can an LOP affect the result in a personal injury lawsuit? 

In some cases, having an active LOP may require you to reject a settlement offer that's not enough to cover both your medical bills and your legal fees. Because the letter of protection does affirm to the medical provider that you'll ultimately pay for any services provided, settling for less than the total amount owed (unless you're planning to pay out of pocket for the rest of your medical bills) can leave you at risk of violating the LOP. 

It's important to heed the advice of your attorney when deciding whether to accept or reject a settlement offer when an LOP is in play. It can be tough to make these decisions when you're still dealing with the physical and emotional aftermath of an accident or injury, and your attorney can ensure that your best interests remain well-represented throughout the legal process.