Being involved in a car accident in Pennsylvania is a highly stressful experience, both physically and financially. After the immediate chaos, the focus shifts to securing fair Pennsylvania car accident compensation. This often involves a lengthy process of negotiation with insurance companies, which typically leads to a car accident settlement process that is intended to resolve your claim and cover your damages.

But what happens when the final agreement—the settlement you thought resolved everything—contains an incorrect settlement amount or was based on an error? Perhaps your settlement was calculated before a latent injury, like a severe disc herniation, became apparent, or maybe the insurer misrepresented the coverage limits. You signed the release of liability, received the funds, and now you realize the determination contained a significant mistake in car accident settlement.

The general rule in Pennsylvania, as in most states, is that once a plaintiff agrees to the terms, signs a release of liability, and receives money, the case is considered permanently settled. The release is a written agreement where you give up the right to sue the defendant again for any related claims. This makes reopening a car accident claim exceptionally difficult. However, the legal system recognizes that settlements can sometimes be tainted by misconduct or fundamental errors. This article will outline the very narrow set of circumstances under Pennsylvania insurance law where an Pennsylvania auto accident attorney may be able to challenge a settlement and fight for the compensation you are owed.

The Barrier to Challenging a Settlement: The Release of Liability

The primary hurdle when considering challenging a settlement in Pennsylvania is the release of liability document. This clause is a standard and necessary component of nearly every final car accident settlement agreement.

Once you sign this release, you are legally promising the insurance company that you accept the negotiated compensation as final and will not come back later to ask for more money, even if you discover additional damages or future injuries. This finality is why insurance companies are eager to secure your signature quickly and why signing should never be done without consulting a Pennsylvania personal injury attorney.

However, the law acknowledges that certain egregious actions or errors can make the original settlement agreement legally unenforceable, potentially providing grounds for reopening a car accident claim.

Grounds for Reopening a Car Accident Claim in Pennsylvania

In Pennsylvania, the courts will only allow you to revisit an officially closed car accident settlement under a very limited set of conditions. These conditions must prove that the original agreement was fundamentally flawed or unjustly obtained.

1. Fraud or Misrepresentation

One of the strongest justifications for reopening a car accident claim is when clear evidence shows the settlement was secured through deceit or fraud.

• Concealed Facts: This occurs if one side—typically the insurer or the defendant—knowingly withheld or distorted vital information that led to an unjust settlement outcome. Examples include hiding insurance coverage limits or concealing pertinent medical records that affected the final value.
• Legal Action: If an insurance company knowingly misrepresented facts to achieve a lower Pennsylvania car accident compensation amount, you may have grounds to file a complaint or pursue legal action to set aside the settlement.

2. Mutual Mistake of Fact

A mutual mistake is less about dishonesty and more about an honest, shared error regarding a foundational fact of the claim.

• Shared Error: A mutual mistake occurs when both parties—the insurer and the victim—misunderstood or misinterpreted a key fact at the time of settlement. For instance, both parties mistakenly believed the available insurance coverage was only $15,000, when in fact, the policy limits were $50,000.
• Proving the Mistake: Courts in Pennsylvania may allow claims to be revisited if it can be proven that the error materially impacted the outcome of the settlement. However, the burden of proof rests on the claimant to demonstrate that the mistake in car accident settlement was truly mutual and central to the agreement.

3. Newly Discovered Evidence (Rare Circumstances)

While a general worsening of your known injuries is not usually enough to challenge a settlement, sometimes new evidence comes to light that was not, and could not reasonably have been, discovered earlier with due diligence.

• Unforeseeable Changes: If your medical condition worsens dramatically after the settlement and that worsening was entirely unforeseeable at the time of the agreement, this can sometimes justify challenging a settlement in Pennsylvania. This is a difficult argument to win because settlements are intended to provide finality.
• Hidden Damage: This may apply in cases where hidden structural damage or severe latent injuries were overlooked during the initial inspection and evaluation.

4. Procedural or Legal Errors

If there were fundamental errors in the court process, such as a misapplication of Pennsylvania negligence laws or a failure to consider relevant evidence, this may offer a path to challenge a judgment or settlement.

The Role of Bad Faith Insurance in Settlement Disputes

While the circumstances above focus on errors in the agreement itself, an entirely separate path to relief exists if you can prove the insurer acted in bad faith during the claims process.

Bad faith insurance refers to an insurance company's attempt to not carry out its obligations to policyholders by acting unfairly, dishonestly, or unreasonably.

Examples of Bad Faith Insurance Affecting Settlement

An insurance claim mistake or an incorrect settlement amount might be the result of deliberate bad faith tactics, including:

• Unreasonable Lowball Offer: Offering an unreasonably low settlement amount merely to force the victim into litigation.
• Delaying Resolution: Intentionally drawing out the process or failing to act promptly on a claim.
• Misrepresentation: Lying about any aspect of your claim or misrepresenting policy provisions.
• Inadequate Investigation: Failing to conduct a dutiful or thorough investigation before denying or minimizing the claim.

If you can prove the insurer's actions led to an undervalued settlement or an incorrect settlement amount, you may be able to file a separate bad faith lawsuit under 42 Pa. C.S.A. § 8371. A successful bad faith claim can result in the insurer being forced to pay punitive damages, your attorney's fees, and interest on the amount of the original claim.

Steps to Take When You Suspect a Settlement Error in Your PA Car Accident Settlement

If you suspect a mistake in car accident settlement has occurred, immediate action is necessary because strict deadlines apply to motions to set aside a judgment or settlement.

1. Do Not Assume You Can Reopen the Case

Recognize that reopening a car accident claim is rare and requires strong, specific justification, usually involving fraud or mutual mistake. New medical bills alone will not work.

2. Gather All Documentation

Collect every piece of paperwork related to the claim, including the final release of liability, the settlement checks, all correspondence with the insurance company, and medical records. This documentation is necessary for a lawyer to perform a comprehensive car accident claim review.

3. Seek Legal Counsel Immediately

This is not a process to attempt alone. A Pennsylvania car accident lawyer or Philadelphia personal injury lawyer can analyze the original agreement to identify if there were misrepresentations or procedural flaws. They can establish the proper legal basis for challenging a settlement in Pennsylvania—whether by filing a motion to set aside the settlement or initiating a new lawsuit against the insurer for bad faith insurance. A Pennsylvania insurance law attorney possesses the knowledge of statutes and case law required to fight this uphill battle.

Call Brandon J. Broderick For Legal Help

If you are an Pennsylvania accident victim who believes a serious mistake in car accident settlement has occurred, you face an incredibly difficult legal challenge. Insurance companies rely on the finality of the signed release to prevent any further payout, especially when the resulting incorrect settlement amount is substantial.

At Brandon J. Broderick, Attorney at Law, we know that proving fraud, mutual mistake, or bad faith insurance requires meticulous investigation and aggressive legal action. Our Pennsylvania car crash lawyer team has the experience to thoroughly review your car accident settlement dispute and fight to hold the insurance company accountable for errors or deceptive tactics. We work tirelessly to protect your Pennsylvania accident victim rights and secure the maximum Pennsylvania car accident compensation you are owed.

Don't let a major settlement error ruin your financial recovery. Contact Brandon J. Broderick, Attorney at Law, today for a free consultation.