A tort judgment can include more than the verdict amount. Indiana’s prejudgment interest statute lets a court add interest, but only when the plaintiff has followed its steps. A timely written settlement offer is the main one.
Prejudgment Interest Applies to Tort Claims
Indiana Code 34-51-4 covers prejudgment interest in civil actions arising out of tortious conduct. Under section 7, the court may award prejudgment interest as part of a judgment. Under section 9, the court sets a simple interest rate that can’t be lower than six percent or higher than ten percent per year.
The word “may” matters. Interest isn’t automatic, and a court looks at whether the plaintiff met the statute’s requirements. The chapter also applies only to tort claims, so contract disputes follow different rules.
A Timely Written Offer Is the Gateway
A plaintiff who wants prejudgment interest must make a written settlement offer to the defendant within one year after filing the claim, though a court may allow a longer period for good cause. The offer must provide for payment within 60 days after acceptance. Its amount can’t exceed one and one-third times the judgment finally awarded.
That math forces a plaintiff to think about case value early. The offer has to be in writing, so a conversation by phone or an email thread without a clear figure won’t do. A plaintiff should also keep proof of when and how the offer was delivered. Each of the damages claim elements feeds directly into the number, so the evidence has to be gathered before the offer goes out.
Interest Starts Later Than the Date of Injury
Interest doesn’t run from the day of the accident. Under section 8, it begins on the latest of three dates:
- Fifteen months after the cause of action arose
- Six months after the claim is filed in court, unless the medical malpractice act’s procedures apply
- 180 days after a medical review panel is formed, where that process applies
Accrual can’t exceed 48 months, and the court excludes any delay it finds the party seeking interest caused. Delay caused by the plaintiff can cost the plaintiff.
What the Rule Means for Case Strategy
Plaintiffs weigh the offer amount against the likely judgment. Set the figure too high and the statute’s interest doesn’t apply. Set it too low and the defendant may accept a number that undervalues the claim.
Personal injury litigation explained shows how those choices fit into the larger case, from the filing through trial. The offer deadline arrives while discovery is still under way.
Defendants face their own timing questions. Anyone who has just received a complaint can follow the early stages of a car accident lawsuit from service through discovery.
Offers can also involve payment terms. Spreading payments over time through a structured settlement may not fit the 60-day payment term the statute requires. That mismatch is worth raising before an offer goes out.
Where Interest Fits Among Other Damages
Prejudgment interest sits beside the verdict, not inside it. Medical bills, lost income, and pain and suffering make up the damages, while interest compensates for the time between harm and payment. Wrongful death cases, which an Indianapolis wrongful death lawyer handles, can involve large judgments where the interest rules carry real weight.
An Attorney Tracks the Offer Deadline
Plaintiffs can ask an Indianapolis civil lawsuits lawyer to calendar the one-year offer deadline from the day a case is filed. The offer amount can then be revisited as the evidence develops.
Donald W. Ward, a former Marion County Deputy Trial Prosecutor who served as president of the Indiana Trial Lawyers Association in 1978 and 1979, practices at Ward & Ward Personal Injury Lawyers with Charles P. Ward, a Super Lawyers honoree since 2005.
An offer that misses the one-year mark puts interest at risk, so a plaintiff who has filed or is about to file in Indianapolis can reach out to us and we’ll go over the timeline together. Starting early leaves room to get the number right.
