Understanding Personal Injury Attorney Fees
One of the biggest concerns people have after an accident is whether they can afford a lawyer. The good news is that most personal injury attorneys work on a contingency fee basis, meaning you pay nothing unless you win. Here is everything you need to know about how personal injury attorney fees work.
How Contingency Fees Work
A contingency fee is a payment arrangement where your attorney agrees to represent you without charging any upfront costs or hourly rates. Instead, the attorney's compensation comes directly from the settlement or court award you receive at the end of your case. If your case does not result in a financial recovery, you typically owe your attorney nothing for their legal services.
This fee structure exists because personal injury law firms understand that most accident victims are already dealing with medical bills, lost wages, and financial stress. Requiring clients to pay hourly rates or large retainers upfront would put quality legal representation out of reach for the people who need it most. The contingency model aligns your attorney's interests with yours: they only get paid when you get paid, which gives them a strong incentive to maximize your recovery.
When you hire a personal injury attorney on a contingency basis, you will sign a fee agreement that spells out the exact percentage your attorney will receive from any settlement or verdict. This agreement should also detail how case costs and expenses are handled. Before signing, take the time to read the entire agreement and ask questions about anything you do not understand. A reputable attorney will be happy to explain every provision.
Typical Fee Percentages
Contingency fee percentages are not fixed by law in most states, but industry standards have emerged based on the stage of your case.
The standard contingency fee when your case settles during negotiations before a lawsuit is filed. At this stage, your attorney handles demand letters, insurance negotiations, and evidence gathering. Most straightforward car accident claims settle during this phase, which typically involves less attorney time and lower overhead compared to litigation.
Once a lawsuit is filed, the contingency fee typically increases to around 40%. Filing a lawsuit triggers the discovery process, which includes depositions, interrogatories, document requests, and potentially motions practice. The attorney's workload increases substantially, and the firm takes on greater financial risk by advancing the costs of litigation on your behalf.
If your case proceeds to trial, the contingency fee may increase to 45% or even higher. Trial preparation is extraordinarily time-intensive, requiring witness preparation, exhibit creation, jury selection strategy, and days or weeks of courtroom appearances. The attorney also bears the risk that a jury could return a defense verdict, resulting in no fee at all despite months of work.
Important note: These percentages represent common industry standards, but they are not mandated by law in Texas. Your specific fee arrangement may vary depending on the complexity of your case, the attorney you hire, and any negotiations you conduct regarding the fee structure. Always confirm your exact fee percentage in writing before representation begins.
What Your Fees Cover
Your contingency fee pays for a wide range of legal services that your attorney and their team provide throughout your case.
Case Investigation
Your attorney will conduct a thorough investigation of your accident, including reviewing police reports, interviewing witnesses, analyzing photographs and video footage, and visiting the accident scene when necessary. This investigation builds the factual foundation of your claim and helps establish liability.
Medical Records & Documentation
Obtaining and reviewing your medical records is a critical part of building your case. Your attorney will request records from hospitals, doctors, physical therapists, and specialists. They will analyze your treatment history to document the full extent of your injuries and connect them to the accident.
Expert Witnesses
Many personal injury cases benefit from expert testimony. Your attorney may retain medical experts to explain your injuries, accident reconstruction specialists to demonstrate how the crash occurred, economists to calculate future lost earnings, or life care planners to project your long-term medical needs. Coordinating these experts is part of your attorney's role.
Negotiations & Litigation
Your attorney handles all communication and negotiation with insurance companies, defense attorneys, and other involved parties. This includes drafting and sending demand packages, responding to counteroffers, attending mediations, and if necessary, filing a lawsuit and representing you in court through trial. This advocacy is the core of what your fee covers.
Costs vs. Attorney Fees
It is important to understand that attorney fees and case costs are two separate things. Your contingency fee is the percentage your attorney earns for their legal work. Case costs, on the other hand, are the out-of-pocket expenses incurred while building and pursuing your claim. These costs are typically advanced by your attorney and then reimbursed from your settlement proceeds.
Common case costs include:
- Court filing fees — the cost of officially filing your lawsuit with the court, which varies by jurisdiction and case type
- Medical record requests — hospitals and medical providers charge fees to copy and release your records, which can add up across multiple providers
- Deposition transcripts — court reporters charge per-page fees for transcribing sworn testimony, and complex cases may involve multiple depositions
- Expert witness fees — medical experts, accident reconstructionists, and economists charge for their time reviewing your case and providing testimony
- Process server and postage fees — the cost of formally serving legal documents to defendants and mailing correspondence throughout the case
Your fee agreement should specify whether case costs are deducted from your settlement before or after the attorney's percentage is calculated. This distinction can meaningfully affect your net recovery. For example, on a $100,000 settlement with $5,000 in costs and a 33% fee: if costs come out first, the attorney receives $31,350 (33% of $95,000) and you take home $63,650. If costs come out after, the attorney receives $33,000 (33% of $100,000) and you take home $62,000. Always ask how costs are handled before you sign.
When You Pay Nothing
The defining feature of a contingency fee arrangement is the “no win, no fee” promise. If your attorney is unable to secure a settlement or win a verdict on your behalf, you owe nothing for their legal services. Your attorney absorbs the cost of all the time and effort they invested in your case. This is a significant financial risk for the law firm, which is why contingency percentages are set at the levels they are.
This arrangement provides a critical safeguard for accident victims. You can pursue your legal rights without worrying about accumulating legal bills you cannot afford. It also serves as a built-in quality filter: attorneys who work on contingency are selective about the cases they accept because they are investing their own time and money. If an experienced personal injury attorney agrees to take your case on contingency, it is a strong signal that they believe your claim has merit and value.
However, it is worth noting that some fee agreements may still require you to reimburse out-of-pocket case costs even if your case is unsuccessful. This varies by firm and agreement. During your initial consultation, ask your prospective attorney directly: “If we lose, do I owe anything at all?” A transparent attorney will give you a clear, straightforward answer.
Getting the Most Value From Attorney Representation
Some accident victims hesitate to hire an attorney because they worry the fee will eat into their recovery. This concern is understandable, but research and data consistently show the opposite result. According to the Insurance Research Council, claimants who hire attorneys receive settlements that are on average 3.5 times larger than those who handle claims on their own. Even after paying the contingency fee, represented claimants typically walk away with significantly more money in their pocket.
Why does attorney representation lead to higher net recoveries? Several factors are at play. First, experienced personal injury attorneys understand the full range of damages you can claim, including future medical expenses, lost earning capacity, pain and suffering, and loss of enjoyment of life. Unrepresented claimants often undervalue these components or overlook them entirely. Second, insurance adjusters know that an attorney-represented claimant is more likely to file a lawsuit if the offer is inadequate, which gives the insurer a stronger incentive to offer fair compensation during negotiations.
Third, attorneys have the technical knowledge to properly document your damages, retain the right experts, and present your case in the most persuasive way possible. They understand the legal standards, procedural requirements, and strategic considerations that can make or break a case. Finally, having an attorney handle your claim frees you to focus on your medical treatment and recovery, which is ultimately the most important thing after an accident.
When evaluating whether to hire an attorney, the question is not whether you can afford a lawyer. Under the contingency model, the question is whether you can afford not to have one.
Frequently Asked Questions About Attorney Fees
Get answers to the most common questions about personal injury attorney fees and the contingency fee structure.
How much does a personal injury lawyer cost?
What is a contingency fee agreement?
Do I have to pay my lawyer if I lose my case?
Can I negotiate my attorney's contingency fee percentage?
What is the difference between attorney fees and case costs?
When does the contingency fee percentage increase?
How are attorney fees calculated from my settlement?
Is it worth hiring a personal injury attorney given the fee percentage?
Related Resources
Ready to Explore Your Options?
Use our free tools to estimate your settlement value or find an experienced personal injury attorney in Texas who works on contingency.