Personal Injury Damages and Compensation

Valuing a personal injury claim starts with understanding the different types of compensable losses.

By , J.D.

If you're considering filing a personal injury claim after any kind of accident—from a car crash to a slip and fall—you may be wondering "What is my case worth?" The answer is often dictated by your damages:

  • In the language of the law, "damages" refers to all losses associated with your accident, from your medical bills and time missed at work, to your physical and mental "pain and suffering."
  • Damages are almost always "compensatory," meaning they compensate for the full spectrum of an injury claimant's losses.
  • In rare cases, "punitive damages" are awarded, to punish the defendant's wrongdoing and deter similar conduct by others.
  • There are several factors that increase personal injury damages, and in turn boost the value of a case.

What Are "Damages"?

In a personal injury case, money damages are paid to an injured person (the plaintiff) by the person or company who is found to be legally responsible for the accident (or their insurance company).

A damages award can be agreed upon after a negotiated injury settlement—between the parties, their insurance companies, and their attorneys, for example. And, in the rare event that a personal injury lawsuit makes it all the way to trial, a damages award may be ordered by a judge or jury.

Let's look at the different kinds of damages in personal injury cases and how a damages award can be affected by the plaintiff's action (or inaction).

Compensatory Damages in Personal Injury Cases

Most personal injury damages are classified as "compensatory," meaning that they are intended to compensate the injured plaintiff for what was lost due to the accident or injury.

A compensatory damages award is meant to make the injured plaintiff "whole" again from a monetary standpoint (to the extent that's possible). This means trying to put a dollar figure on all the consequences of an accident. Some compensatory damages are relatively easy to quantify—like reimbursement for:

The above kinds of losses are often categorized as "special damages." It's typically harder to place a monetary value on the other main type of personal injury damages: "general damages." This category includes "pain and suffering" and the inability to enjoy hobbies or spend time with loved ones because of accident-related injuries and their effects.

Here's a rundown of the different types of compensatory damages that are common in many personal injury cases.

Types of Compensatory Damages

"Special" damages in a personal injury case might include:

Medical treatment. A personal injury damages award almost always includes the cost of medical care associated with the accident—reimbursement for treatment you've already received and compensation for the estimated cost of medical care you'll need in the future because of the accident.

Lost income. You may be entitled to compensation for the accident's impact on your salary and wages—not just income you've already lost but also the money you would have been able to make in the future, were it not for the accident. In personal injury legalese, a damage award based on future income is often characterized as compensation for an accident victim's "loss of earning capacity."

Property loss. If any vehicles, clothing, or other items were damaged as a result of the accident, you'll likely be entitled to reimbursement for repairs or compensation for the fair market value of the property that was lost.

"General damages" typically include:

Pain and suffering. You may be entitled to get compensation for pain and serious discomfort you suffered during the accident and in its immediate aftermath—also for any ongoing pain that can be attributed to the accident. Learn more about pain and suffering in a personal injury case.

Emotional distress. Usually linked to more serious accidents, emotional distress damages are meant to compensate a personal injury plaintiff for the psychological impact of an injury—including fear, anxiety, and sleep loss. Some states consider emotional distress as part of any "pain and suffering" damages that is awarded to a personal injury plaintiff.

Loss of enjoyment. When injuries caused by an accident keep you from enjoying day-to-day pursuits like hobbies, exercise, and other recreational activities, you may be entitled to receive "loss of enjoyment" damages.

Loss of consortium. In personal injury cases, "loss of consortium" damages typically relate to the impact the injuries have on the plaintiff's relationship with their spouse—the loss of companionship or the inability to maintain a sexual relationship, for example.

Some states also consider the separate impact on the relationship between a parent and their child when one is injured. In some cases, loss of consortium damages are awarded directly to the affected family member rather than to the injured plaintiff.

Damages and Personal Injury Case Settlements

As we mentioned earlier, the term "damages" can be used to refer to an injured person's losses in both the insurance claim context and the court-based personal injury lawsuit context. But to be clear, most personal injury cases settle out of court, often without a lawsuit ever being filed.

A settlement can occur at any point after an injury. Most often, if there's an insurance policy that covers the underlying accident (like car insurance coverage after a traffic accident), the injured person will file an insurance claim, back-and-forth negotiations take place, and an injury settlement is eventually agreed upon. Of course, the details that are woven through those steps will determine what happens in a given case.

Learn more about how the settlement negotiation process works in an injury case.

What's the Average Personal Injury Case Settlement?

There's too little in the way of reliable data for us to answer this question in any meaningful way. And even if we could offer this kind of information, it wouldn't mean much to a particular claimant's specific situation. After all, every personal injury case is unique in terms of:

  • the details of the underlying accident
  • the nature and extent of the claimant's injuries
  • the claimant's non-injury harm (including financial losses)
  • the claimant's subjective post-accident experience, including pain and suffering and lost enjoyment of life, and
  • the characteristics of those involved in the injury claim process, including their willingness to come to a fair resolution.

Having said all that, there are a few factors that tend to have the biggest impact on the value of a settlement.

What Factors Can Increase the Value of Your Personal Injury Case?

Did we mention that every personal injury case is unique? Still, factors that will carry the most weight in terms of the value of your potential settlement include:

  • the seriousness of your injuries, including whether or not you're likely to experience long-term effects like disability
  • whether there's insurance coverage (and enough of it) to pay for the full extent of your damages
  • whether the other side's liability (fault for the underlying accident) is clear and is accepted by all parties, and
  • your credibility (and the credibility of your witnesses) and how sympathetic you (and they) might come across as in the eyes of a jury

Learn more about how insurers value an injury claim.

Does the Statute of Limitations Affect the Value of a Personal Injury Case?

A statute of limitations is a law that sets a time limit on the right to file a lawsuit in court. In the context of a personal injury claim:

  • the statute of limitations in your state gives you a certain number of years to get your lawsuit filed against the person or business responsible for your injury, and
  • the clock usually starts ticking on the date of the incident that caused you harm.

Learn more about the statute of limitations in personal injury cases.

The statute of limitations won't usually play a big part in determining the value of your personal injury case, unless the lawsuit-filing deadline is approaching. In that situation, the person responsible for your injury (or their insurance company) might make you a "take it or leave it" offer that's below what your injury claim is worth, forcing you to go to the time and expense of filing a lawsuit if you want a fair outcome for your case.

Once your lawsuit gets started—assuming it's filed within the applicable time limit—the statute of limitations will no longer be a factor in the valuation of your damages. If anything, since you're now at the litigation phase of things, and the defendant knows that a settlement is the only thing keeping your case out of the unpredictable hands of a jury, the value of your case is probably at its peak.

Personal Injury Damages/Case Value Example

To get an idea of how damages might look in a personal injury case, and how valuation of the claim might go, consider a passenger (Claimantine) who is injured in a car accident:

  • The vehicle Claimantine was riding in was rear-ended at a stoplight.
  • Claimantine went to the ER and saw her primary physician. Her nausea, dizziness, and sensitivity to light were concerning enough that she underwent a CT scan, after which she was diagnosed with a concussion and whiplash-type neck strain.
  • Claimantine missed two weeks of work and continued to suffer pain and sleeplessness for more than a month post-accident.
  • She was unable to exercise for six weeks, and had to miss her sister's wedding.

Claimantine files a claim with the at-fault driver's insurance company.

Based on the amount of her medical bills ($5,000) and her time missed at work (which amounted to $7,500 in lost income), her total special damages are $12,500. Of course, those damages need to verified by medical records and documentation from her employer.

Claimantine's general damages are harder to quantify. But given that she experienced significant discomfort and saw her life adversely affected for over a month, a "pain and suffering" valuation of $10,000 to $15,000 is probably reasonable. Two important factors here are the legitimate need for a CT scan and the concussion diagnosis.

So, adding the special and general damages together, a reasonable assessment of the value of Claimantine's claim is somewhere between $22,500 and $27,500.

How Your Actions (or Inaction) Can Affect a Damages Award

In some cases, an injured person's role in causing an accident—or their inaction after being injured—can diminish the amount of damages available in a personal injury case.

Comparative negligence. If you're at fault (even partially) for the accident that caused your injuries, chances are that any damage award will reflect that. That's because most states adhere to a "comparative negligence" standard that links damages to degree of fault in a personal injury case.

Contributory negligence. In the small handful of states that follow the concept of "contributory negligence" for personal injury lawsuits, you may not be able to recover any compensation at all if you're deemed partially to blame for the accident.

After the accident: failure to mitigate damages. The law in most states expects plaintiffs in personal injury cases to take reasonable steps to minimize or "mitigate" the financial impact of the harm caused by the accident.

If an injured plaintiff just sits back and rests on their proverbial laurels when it isn't reasonable to do so (by failing to get necessary medical treatment after an accident, and making their injuries much worse, for example) a damages award might be significantly reduced. (Learn more about defenses in personal injury cases.)

Punitive Damages In Personal Injury Cases

In cases where the defendant's conduct is deemed particularly egregious or outrageously careless, a personal injury plaintiff may be awarded punitive damages on top of any compensatory damages award. Punitive damages stem from a rationale that is quite different from the justification tied to compensatory damages, which attempt to "make someone whole."

Punitive damages are awarded to the injured plaintiff, but the real goal of these kinds of damages is to punish the defendant for its conduct—to "hit them in the pocketbook," so to speak—and to act as a deterrent. Since it isn't unusual for punitive damage awards to top tens of millions of dollars, most states have set some type of cap on punitive damage awards in personal injury cases.

How Will I Receive Payment for My Damages?

In most instances, you'll receive compensation for your damages after you enter into a settlement agreement and sign a release. At that point, you (or your attorney) will usually receive a check (from an insurance company, for example). But there are a few things to keep in mind here.

If you receive a court-ordered damages award, the losing party might appeal the outcome. With a settlement, an appeal isn't an option, so there's little standing between you and your check, though read on to learn why the amount you end up receiving will probably be lower than what you might expect.

If you're working with a lawyer, chances are they're representing you under a contingency fee agreement. This means the lawyer gets paid for their legal services out of any settlement or court award you receive. A typical contingency fee percentage is around 33 percent, meaning if your damages award is $100,000, you'll receive just under $67,000, and your lawyer will get a little over $33,000. Learn more about how personal injury lawyers get paid.

Your health insurer or a health care provider might have a lien on your settlement or court award. Any time you make a personal injury claim, and medical care you receive is related to that claim, chances are your health insurance company or the health care provider will be on notice of that fact. And if you end up receiving an injury settlement or court award, the health insurer or care provider will likely have a lien (meaning a right to reimbursement of money paid, or a right to payment of money owed) on the settlement/award. Get more information on health insurance and health care provider claims on injury settlements.

Getting Help With a Personal Injury Claim

Understanding how damages work is important any time you're thinking about making a claim for injuries, in or out of court. But figuring out how to prove the different categories of damages that make up your accident-related losses and putting your best case together are crucial. To that end, there's no substitute for having an experienced personal injury lawyer on your side.

Learn more about finding and working with a personal injury lawyer, or use the features on this page to connect with an injury attorney in your area.

For more information about damages awards in specific types of personal injury cases, see our articles on damages in defective product cases and damages in medical malpractice cases.

Portions of this article have been excerpted from the bestselling book How to Win Your Personal Injury Claim, by Joseph L. Matthews (Nolo).

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