How Contingency Fees Work in Injury Cases

If you are worried about the cost of hiring a lawyer after an accident, you will often hear the term "contingency fee." It is how many personal injury firms are paid.

The basic idea

With a contingency fee, the lawyer's fee is a percentage of the money recovered in your case. If there is no recovery, you generally owe no attorney fee. That is why many people can consult an injury lawyer without paying anything upfront.

What the percentage usually looks like

Percentages vary by firm, by state, and by the stage of the case. It is common to see a lower percentage if the case settles early and a higher one if a lawsuit has to be filed or the case goes to trial. Some states or case types cap or regulate fees. Ask for the exact numbers rather than assuming.

Fees and costs are different

This is the part people most often miss. In addition to the attorney fee, a case has expenses, such as:

• Court filing fees
• Obtaining medical records and police reports
• Expert witnesses
• Depositions and transcripts
• Medical illustrations or other exhibits

Ask whether case expenses are deducted before or after the fee is calculated, and whether you are responsible for them if the case does not result in a recovery. Different firms handle this differently, and it can change what you take home.

What to look for in the agreement

The fee agreement should be in writing. Read it before you sign, and look for:

• The fee percentage at each stage
• How expenses are handled
• What happens if you change lawyers
• Who decides whether to accept a settlement offer (it should be you)

Questions worth asking

1. What percentage do you charge, and does it change if the case goes to court?
2. Are expenses taken out before or after your fee?
3. Will I get a written breakdown when the case ends?
4. Are there any charges I might owe even if there is no recovery?

One caution

A contingency arrangement does not mean the lawyer or this website can promise any result. The fee depends on a recovery, and a recovery is never guaranteed.

This article is general information, not legal advice. Fee rules differ by state and by case type.