Post-accident finances can be difficult to discuss
By Kirsten McMahon, Managing Editor
Getting injured in an accident can have devastating physical and emotional effects, but those stresses may be compounded by financial issues, says Easy Legal Finance Inc. president and CEO Larry Herscu.
“An accident can often be a life-changing event,” he says. “Not only are you struggling with physical, mental and emotional issues, but if you no longer have a steady income, it can become a challenge just to put food on the table.”
Talking to others about personal finances can be an awkward and difficult conversation at the best of times.
“It becomes much harder when financial strain is added on top of mental and physical anguish,” Herscu says. “When someone is unable to work and can’t pay their bills, it’s hard to know where to turn. Family and friends might be able to help on a short-term basis, but so many people are already stretched so thin.”
According to a recent study by the Canadian Payroll Association, 44 per cent of respondents said it would be difficult to make ends meet if their paycheque was delayed by even one week.
The authors of the study noted Canadians continue to carry very high debt loads, and it’s impacting their ability to save for things like retirement or contingency funds.
Turning to a bank or credit union for a loan may also be difficult because a person typically requires employment verification and a steady source of income in order to qualify. If you can’t work because of your injury and you can’t get a loan because you don’t have a job, it’s a catch-22.
While launching a personal injury claim may provide a settlement for damages further down the road, plaintiffs are waiting longer for their cases to be processed, which creates an income gap.
“Plaintiffs are not always having these difficult financial conversations with their personal injury lawyers either,” Herscu notes. “Rather than explain to their lawyer the financial situation they are in, they may just express a desire for an expedited process in order to receive a settlement as soon as possible. However, this can take two to four years or longer.”
Easy Legal Finance Inc. offers financial support to people who have been hurt in an accident to help them pay bills while their lawyer fights for a fair settlement.
“We will not lend money to a client without their lawyer being aware of it and understanding how we got to the amount,” Herscu says. “It’s important to find a lender that’s willing and truly understands a person’s expenses and needs. Understanding that income gap is at the core of who we are and what we do.”
He explains that the initial intake process can take time because staff want to fully understand a client’s expenses and concerns.
“It’s not just writing a cheque,” Herscu says. “Our intake team looks critically at the numbers, and our case managers have ongoing conversations about continuing needs. It takes time to put people on a plan that works best for them.”
He adds that because of the legal and insurance experience of Easy Legal’s senior staff, lawyers are less reticent about working with his firm.
“They don’t just see us as a lender, they see us as a partner.”