How a contingency fee works
Most injury lawyers work on contingency: no fee unless you recover money, and then a percentage of the recovery. One-third (33⅓%) is the most common rate. Many agreements rise to 40% if a lawsuit is filed or the case goes to trial, and some states cap fees in certain cases, such as medical malpractice.
Gross or net makes a real difference
Your agreement says whether the fee is taken from the gross settlement (before case costs) or the net (after case costs). On a $100,000 settlement with $3,500 of costs, a one-third fee is $33,333 on the gross and $32,167 on the net. Ask which one your agreement uses before you sign.
The order money comes out
| Settlement | $100,000 |
| Attorney fee (33⅓% of gross) | −$33,333 |
| Case costs | −$3,500 |
| Medical bills and liens | −$15,000 |
| You take home | $48,167 |
Case costs are separate from the fee
Costs are the out-of-pocket expenses of the case: filing fees, medical records, expert reports, depositions and court reporters. They are small in a claim that settles early and can reach tens of thousands of dollars in a case that goes to trial. Ask for an itemized closing statement.
Liens can often be reduced
Hospitals, health plans and Medicare must be repaid from the settlement, but many will reduce their claim, especially when the recovery is limited by insurance. Lawyers negotiate these reductions routinely. Model yours with the medical lien calculator.
Questions people ask
What percentage do personal injury lawyers take?
Usually 33⅓% of the recovery, often rising to 40% if a lawsuit is filed or the case goes to trial. Rates as low as 25% are sometimes offered for claims that settle quickly.
Do I pay the lawyer if I lose?
Not a fee under a contingency agreement. Check whether you would owe case costs; many firms waive them if there is no recovery.
Is the attorney fee negotiable?
Often, yes, especially for clear liability cases with high policy limits. Get the terms in writing.