If you’ve ever seen a legal ad saying something like, “Pay nothing until we win!” or “No win, no fee,” that law firm operates on a contingency fee basis.
Contingency fees help clients get access to the legal help they need without having to pay up front.
Here’s a closer look at what you need to know about contingency fees.
How Contingency Fees Work
Many types of lawyers bill their clients on an hourly basis or charge a flat fee. More often than not, personal injury lawyers collect contingency fees instead.
Contingency fees are so named because they make a lawyer’s payment contingent on the outcome of the case. If they win a case (either by negotiating a settlement or securing a verdict at trial), the lawyer receives a percentage of the total compensation awarded to the client. If they don’t win, they receive nothing.
Contingency fees offer two primary benefits to clients. First, they make it possible to access skilled legal help regardless of financial status. Second, they give attorneys an incentive to build a strong case and fight for the largest possible settlement or trial verdict.
Why Most Personal Injury Law Firms Work On A Contingency Fee Basis
If you’ve just been injured in a car accident, you might be dealing with significant medical bills and unable to work. In this situation, paying a lawyer up front may be difficult or impossible. That’s why nearly all personal injury law firms work on a contingency fee basis.
When you’re dealing with an injury or loss, the last thing you need is more stress—especially about money. With a contingency fee agreement, your lawyer steps in to handle everything: investigating what happened, filing claims, dealing with the insurance company, and negotiating for a fair outcome. If a settlement isn’t possible, they’ll be ready to fight for you in court.
You don’t have to pay anything up front. If your case is successful, the firm gets paid only when you do—so you can focus on healing, not legal bills.
What Do Lawyers Look For When Choosing A Case?
Because personal injury law firms only get paid when they win, they can’t accept every case that comes to them. Personal injury attorneys assess claims on a case-by-case basis, but they ask themselves the following when making a decision:
- Can I prove that the other party was at fault?
- Can I prove that the other party’s actions caused the client’s injuries?
- Are the client’s injuries serious?
Before agreeing to represent a client, an attorney will make sure that the case’s financial value is significant enough to make it worthwhile for both parties.
For example, imagine someone sped through a red light and hit your car, resulting in a serious brain injury. The other driver was clearly in the wrong, and brain injuries are costly to treat. A personal injury lawyer would likely agree to represent you.
Now, imagine a similar accident occurred, but your car had minor damage and you suffered a sprained ankle. The other driver was clearly at fault, but even if you were to win your case, the money you could recover would be minimal. Most personal injury lawyers would not take the case.
How Much Is A Contingency Fee?
Contingency fees typically range from about 30% to 40% of the compensation recovered. Many law firms charge lower contingency fees for cases that settle out of court and higher fees for cases that go to trial. This is because trials often involve expert witness fees, court costs, and other expenses.
Some states have laws that place caps on contingency fees. Indiana does not, but Indiana law requires fees to be “reasonable.” Before a lawyer agrees to represent you, they will ask you to sign a contingency fee agreement. The agreement should clearly outline the fee amount and its calculation method.
What Happens If Your Lawyer Can’t Recover Compensation For You?
Personal injury lawyers who work on a contingency fee basis only accept cases they believe they can win. However, in the legal industry, there’s no way to predict something with complete certainty, so an attorney can have a strong case and still lose.
This is a disappointing situation for the lawyer and the client alike. If your lawyer ultimately is unable to recover compensation for you, you won’t owe any legal fees.
Contact Wilson Kehoe Winingham Injury Lawyers For A Free Consultation With An Indianapolis Personal Injury Lawyer
If you’ve been hurt in a car or truck accident (or have suffered serious injuries because of someone else’s negligence), you shouldn’t have to shoulder the burden of your injuries alone. At Wilson Kehoe Winingham Injury Lawyers, we are committed to fighting for your rights and helping you get the compensation you deserve.
Because we work on a contingency fee basis, you pay nothing unless we recover compensation for you. Reach out to our Indianapolis personal injury attorneys at (317) 920-6400 now to book your free consultation.