The right time is whatever is right for you. You may retain an attorney to handle your case but the attorney is first and foremost an advisor. An attorney cannot accept or reject offers to settle your case, as you alone are the decision maker on whether to settle your case. A competent attorney will provide you with the risks and benefits of settling and will provide you with his or her recommendations. In the end, the decision to settle always is the client’s.
Settlement is a bilateral (or multilateral) transaction. In other words, both (or more if there is more than one at-fault party) parties (you and the at-fault person or entity) must agree to a resolution for a settlement to occur.
Settlement can happen before litigation (i.e. before filing a lawsuit), during litigation, and even after a verdict has been rendered by an arbitrator or jury. When to settle is based on a slew of factors: (1) the value to the client; (2) the market value of the claim (i.e. what it may be valued to an arbitrator or jury); and/or (3) the value to the person having to pay you.
The value to the client (you) is dependent upon a number of additional factors including:
(1) whether you believe the value is fair (i.e. adequately compensates you); (2) and whether you have the time and financial resources to litigate the case and wait for a recovery you believe adequately compensates you for your loss. There are risks and benefits to settling a case earlier on as well as after litigation or even choosing to not settle at all.