Accident and personal injury litigation is frequently handled on a contingency basis. When an agreement is made to pay a lawyer on contingency basis, the fee is set at a prearranged percentage, of the awarded amount. The percentage of the amount to be paid, will vary from state to state, and lawyer to lawyer, and is generally determined by the type of case involved. In some states, the percentage that a lawyer may charge, by way of a contingency fee is set by law. It may be a fixed percentage, such as 33-1/3% of all sums recovered, or based on a sliding scale, such as 40% of the first $10,000 recovered, 35% of the next $40,000, 30% of the next $150,000, and25% of the next $300,000.The advantages of paying on a contingency basis are manifold. Firstly, if the claim is lost no payment is made to the lawyer. In case there is a settlement, which is paid over time, the attorney can be paid as the settlement amount is received. The plaintiffs can hire an expensive attorney though they cannot afford to do so when filing the case. The disadvantage of paying on contingency is that a sizeable percentage of any award or settlement has to be given away.Though the attorney will not have to be paid in case the claim is lost, the plaintiff is responsible for expenses the attorney incurred for medical reports, investigative services, expert witnesses, court costs and court reporter fees. Whatever may be the outcome of the claim, the cost of bringing the claim to court is borne by the plaintiff.It is advisable to fully understand any legal agreement, or arrangement entered into with a lawyer before commitment. It is an established legal practice as such cases involve large claims and financial liabilities. For this reason, attorneys are assured of high service fees in case of a favorable verdict.