Best Collections Strategies for Contingency Practices
Post-resolution follow-up that actually closes cases
A case settles. You call the other side's insurance to move it forward. Emails pile up. Documentation moves slow. Weeks pass. The settlement check doesn't land. Your client calls asking when they're getting paid.
Collections is the tail end of the case. It's unglamorous work. It's also the part that separates firms that get paid from firms that get stranded with open files.
Nimbus Marlowe is the AI operations layer for personal-injury law firms, starting with intake. Contingency firms often skip rigorous collections strategies because the case feels done once it settles. It's not done until the money is in your trust account and distributed to your client.
Why collections matters on contingency
On contingency, settlement is not the same as payment. You've negotiated the settlement value, but you haven't collected. The insurance company has to process the claim, issue the check, and send it to your trust account. That process can take weeks or months.
Meanwhile, your client is waiting. They assume once the case "settles" the money is already theirs. You know better, but explaining the process slows things down.
A collections strategy is a system. It tracks every open settlement from the settlement date through the check hitting your account and distribution to the client. Nothing falls through.
For firms handling 20 to 50 cases a year, having a systematic collections workflow is the difference between cash flow problems and predictable revenue.
What a collections strategy includes
First, the settlement sheet. The moment a settlement agreement is signed, you document it: settlement amount, parties, expected payment date, and who is responsible for payment. Insurance company? Defendant directly? Another attorney representing a co-defendant?
Second, follow-up triggers. 5 days after settlement, send a follow-up confirming the settlement amount and asking for an expected payment date. 10 days after, if you haven't heard back, send another follow-up. 20 days after, if the check hasn't arrived, escalate the tone.
Third, documentation trail. Every email, call, and message should be logged. If payment gets stuck and you need to pursue collection, you have the evidence of your diligence.
Fourth, client communication. Your client needs to know the settlement is reached but payment is pending. Manage expectations. Tell them the timeline. Most insurance companies pay within 30 days. Some take 60. Knowing the process reduces the number of "where's my money" calls.
Fifth, attorney review of the settlement agreement itself. Before you sign, make sure the payment terms are clear. 30 days net? Check arrival or wire transfer? Who pays the medical liens, if any? These details matter when payment is delayed.
Why collections slips
For solo practices and small teams, collections falls into the cracks because it's not the billable work. The attorney handled intake, negotiated the settlement, oversaw case prep. Now the settlement is done and the attorney moves to the next case. Collections becomes a background task.
Without a system, settlements age. You don't follow up consistently. The insurance company doesn't send anything because you haven't asked. The client gets frustrated. You get frustrated. Cash flow stalls.
A post-resolution follow-up system is just a checklist and a schedule. It doesn't take hours. It takes discipline.
Building a collections workflow
Designate one person (attorney or paralegal) to own collections. Every open settlement goes into a spreadsheet or case-management system. The owner sets reminders: 5-day follow-up, 10-day follow-up, 20-day follow-up, 30-day follow-up.
At each trigger, they send a follow-up email. No drama. Professional and brief. "Hi, we settled your claim for X amount. We expect payment within 30 days. We'll follow up if we don't hear anything."
When the check arrives, the settlement is marked closed. Payment is made to the trust account. Distribution is made to the client.
If payment stalls after 45 days, escalate. Call the insurance company. Ask for a case number and payment status. Document the call. If payment doesn't arrive after 60 days, you might be dealing with a real problem, not a processing delay. At that point, consider sending a demand letter for the settlement proceeds.
The numbers on collections
A case that settles for 50k and takes 60 days to get paid is revenue delayed, not revenue lost. For a 10-case-a-year firm, that's the difference between 500k in annual revenue and 500k in revenue that's trickling in quarterly.
A firm handling 50 cases a year with an average settlement of 40k collects 2 million per year, but only if cases actually collect. If half your settlements are collecting in 60 days instead of 30, that's a million dollars in payable revenue sitting in the pipeline at any given time.
Collection strategies cut that timeline from 60 days to 40 days on average. That's meaningful cash flow improvement.
Automation for collections
An AI collections follow-up system can handle the routine work: sending follow-ups on schedule, logging responses, flagging stalled settlements. Your attorney only gets involved if a case stalls beyond 45 days.
The cost is flat per collections case, part of a broader case-management operations layer. You upload the settlement data, the system sends follows-ups on schedule, and you get a summary every week of which cases are pending and which are overdue.
It removes the burden from your team so collections never gets buried.
The discipline part
The actual hard part of collections isn't complicated. It's consistency. You have to follow up every time, not just when you remember. You have to document every interaction. You have to own it.
A checklist works. A system works. A calendar reminder works. Pick something that fits your practice and use it every time without exception.
Sign up now for a case-management system with built-in collections follow-up. Book a call to see how post-settlement workflow gets handled.
Frequently asked questions
How long should settlement collection typically take?
Most insurance companies pay within 30 days of settlement. Some take 45 to 60 days depending on their process. Your settlement agreement should specify payment terms. If it doesn't, specify it during negotiation.
What if the insurance company stops responding?
After 45 days with no response, escalate your follow-up to a formal demand letter for the settlement proceeds. Document every attempt to collect. If it continues past 60 days, consider consulting a collections attorney or pursuing a suit for breach of the settlement agreement.
Should I charge my client interest if their settlement payment is delayed?
No. The delay is not the client's fault, and charging interest creates liability. Your fee is from the settlement amount; your client doesn't subsidize your collection problems.
Can I use an AI system for collections follow-up?
Yes. An AI collections follow-up system can send reminder emails on schedule, log responses, and flag stalled cases. Your attorney only gets involved for escalation or problem-solving. The routine follow-up is automated.
Put your firm's operations on autopilot. Reviewed by you.
Nimbus Marlowe is the AI operations layer for personal-injury firms. The CRM is free, pricing is flat and per-unit, and every output is a draft your attorneys review and adopt.