# Time-limited demand

> A time-limited demand is a settlement offer an insurer must accept by a set date. Why these demands carry high stakes and how states regulate them.

Canonical page: https://accidentclaimfacts.com/glossary/time-limited-demand/  
Last reviewed: October 29, 2026 by the Accident Claim Facts editorial team  
General information, not legal advice. Talk to a licensed attorney in your state.

## Quick answer

A time-limited demand is an offer to settle a claim, usually within the at-fault driver's policy limits, that the insurer must accept by a stated deadline. If the insurer does not accept in time, the offer expires.

## In a car accident claim

These demands are usually sent by an injured person's lawyer when the injuries are serious and the at-fault driver's coverage looks too small. The stakes are high for the insurer. Unfair claims practice laws modeled on an NAIC act list as an unfair practice not attempting in good faith to effectuate prompt, fair and equitable settlement of claims submitted in which liability has become reasonably clear. In many states, an insurer that unreasonably passes up a chance to settle within its limits can face a bad faith claim for the amount of a later verdict above them.

Because of those stakes, some states regulate these demands. Missouri is one example: a time-limited demand must be in writing, refer to the statute and go to the insurer by certified mail, return receipt requested, must stay open at least 90 days after the insurer receives it, and must allow at least 10 days for payment after the insurer receives the signed release. It must also include a list of treating providers with HIPAA-compliant authorizations, plus a list of employers with authorizations if lost wages are claimed.

The guide to [demand letters](https://accidentclaimfacts.com/claim-process/demand-letter/) explains how demands are put together, and [settlement negotiation](https://accidentclaimfacts.com/claim-process/settlement-negotiation/) covers what usually follows.

## Example

> **Example:** A driver is badly hurt by a driver carrying only the minimum liability coverage. The injured driver's lawyer sends the insurer a written offer to settle for the policy limit, with the medical records attached, open for the period state law requires. If the insurer lets the deadline pass without a reasonable response and a jury later awards more than the limit, the insurer may face a bad-faith claim.

## Related terms

- [Demand letter](https://accidentclaimfacts.com/glossary/demand-letter/)
- [Bad faith](https://accidentclaimfacts.com/glossary/bad-faith/)
- [Policy limits](https://accidentclaimfacts.com/glossary/policy-limits/)

## FAQ

### Is a time-limited demand the same as a demand letter?

It is a type of demand letter. Any demand letter asks for payment; a time-limited demand adds a firm deadline to accept, and in some states it must follow specific rules.

### What happens if the insurer misses the deadline?

The offer lapses, and the case continues, often toward a lawsuit. Whether the insurer can later be liable above its policy limit depends on state law and on whether its response was reasonable.

## Sources

- [Revisor of Missouri, RSMo § 537.058](https://revisor.mo.gov/main/OneSection.aspx?section=537.058) — time-limited demand requirements
- [NAIC, Unfair Claims Settlement Practices Act (Model 900), Sec. 4](https://content.naic.org/sites/default/files/model-law-900.pdf), checked October 29, 2026