Demand Letter

What Is A Demand Letter?

A demand letter is the opening move in settlement negotiations. It is usually sent after the injured person reaches maximum medical improvement, so that the full extent of the injury and its cost are known. The letter is addressed to the liability adjuster handling the claim and is accompanied by a package of exhibits: the crash report, photographs, witness statements, medical records and bills, wage-loss documentation, and any expert opinions. It closes with a demand for a specific sum and, typically, a deadline for a response.

The demand is not a court filing and has no legal effect on the claim’s existence. It is persuasive writing addressed to a professional evaluator, and its purpose is to make the adjuster’s reserve and authority large enough to settle the claim at its value. Insurers read hundreds of these; the ones that move the number are organized, documented, and specific about the law.

What Does A North Carolina Demand Letter Include?

The structure is standard, but the content is North Carolina-specific. The liability section walks through the crash with the evidence attached and cites the rule of the road the insured broke. In North Carolina it must also address contributory negligence head-on: the demand should show, with evidence, that the injured person was where they were entitled to be, doing what a careful person does, so that the adjuster cannot use the state’s all-or-nothing fault rule as a reason to deny. The damages section lists medical expenses at the amounts actually paid or still owed, because N.C. R. Evid. 414 limits medical-expense evidence at trial to those figures, and an adjuster will discount any demand built on the higher billed amounts.

How Does The Demand Process Work In North Carolina?

The first step often comes before the letter. Under N.C. Gen. Stat. § 58-3-33, a person claiming injury under a private-passenger auto policy may request the insured’s policy limits by certified mail; after the claimant provides a medical-records release, consent to mediation, and the accident report, the insurer must disclose the limits within 30 days. Knowing the limits before the demand is sent shapes the number, because a demand above the policy limits is a different document from one within them.

Once the demand is delivered, North Carolina’s unfair claim settlement practices statute, N.C. Gen. Stat. § 58-63-15(11), describes how an insurer is expected to respond: acknowledge and act reasonably promptly on claim communications, investigate before refusing to pay, attempt in good faith to settle promptly and fairly once liability is reasonably clear, and explain the basis for any denial or compromise offer. The usual sequence is an acknowledgment, a period of evaluation, and a counteroffer well below the demand, followed by rounds of negotiation. If the rounds stall, the next steps are mediation or a filed complaint.

• Before the demand: request the policy limits under § 58-3-33 and identify every lien and subrogation claim.
• Timing: send the demand when treatment is complete or the prognosis is settled, well inside the filing deadline.
• After the demand: expect a counteroffer, negotiate in rounds, and calendar the statute of limitations throughout.
• If it stalls: mediate or file suit; the demand is leverage, not a remedy.

What Does A Demand Letter Look Like In A North Carolina Case?

An illustrative example: a delivery driver in Fayetteville is struck by a car that turns left across his lane. He has a fractured wrist requiring surgery, misses nine weeks of work, and finishes physical therapy six months after the crash. His lawyer first requests the policy limits under § 58-3-33 and learns the at-fault driver carries $100,000 per person. The demand package includes the crash report showing the other driver was cited for failing to yield, dashcam footage showing the delivery driver traveling within the speed limit with his headlights on (which answers the contributory negligence argument before the adjuster raises it), the surgical records, medical expenses stated at the $22,000 actually paid rather than the $41,000 billed, wage-loss documentation of $9,000, and a narrative of the lasting grip weakness. The demand is $85,000, within the limits.

The adjuster responds with $30,000 and a note questioning whether the driver braked in time. The lawyer answers with the footage timestamps and the responding officer’s statement, and the claim settles at $72,000 after two more rounds. All figures are hypothetical and illustrative only; no two claims resolve the same way.

Why Does The Demand Letter Matter For A North Carolina Injury Claim?

Because it is usually the only time the injured person’s side of the case is presented in full before money changes hands. Most claims settle without a lawsuit, which means the demand is the trial for most injured people, and the adjuster is the jury. It is also the point where North Carolina’s contributory negligence rule is won or lost at the claims stage: an adjuster who sees a demand that has already closed off the plaintiff-fault argument evaluates the claim very differently from one who sees an opening. The demand also fixes the medical-expense figures under the paid-versus-billed rule and identifies the liens that will come out of any settlement, so the number demanded reflects what the client will actually keep. How the number is built is explained on our page on how a North Carolina injury settlement is valued.

When Should You Not Send A Demand Letter Yourself?

A self-written demand is common in small property-damage claims and risky in injury claims. The letter commits the injured person to a version of the facts, a set of injuries, and a number, and every statement in it can be quoted back later. Overstating the injury, understating the treatment gaps, using billed rather than paid figures, or admitting a fact that supports contributory negligence can lower the value of the claim permanently. It also signals that no lawsuit is coming, which changes how the adjuster prices the risk. For anything beyond a minor claim, have a lawyer build the demand.