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How Personal Injury Compensation Works

The True Costs of an Accident Are Significant. Don't Be Left Short Changed. Learn What You Are Entitled To.

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If you have been involved in an accident which was caused by another person, then you are entitled to receive damages, or monetary compensation, to provide restitution for your injury. What will you receive? That depends.

What are types of personal injury damages?

There are several different types of damages, and they are awarded based on a number of factors.  Learn about the different types of personal injury claims and the average compensation that one could expect.

Economic Damages

The first type of damages are economic damages, also known as pecuniary damages. Economic damages relate to out-of-pocket costs, on which one can place a precise monetary figure. Although there may be some debate about the precise nature of the economic damages, typically it is a fairly straightforward matter to demonstrate them and to calculate them in court.

call ambulanceThe two main types of economic damages in an accident case are medical expenses and lost wages. Medical expenses can include items such as the cost of paramedics and ambulance transportation to the hospital, emergency room treatment, hospital fees, costs of medical devices, and costs of rehabilitation and physical therapy. They can even include anticipated future medical costs, for however long it is projected that the you will take to recover from the accident.

Like medical bills, lost wages include a variety of items. They can include the time which you are forced to take off work because of your injury, whether you earn an hourly wage or an annual salary. Lost wages can also include bonuses and overtime. If you are forced to leave your job because of the injury, then damages for lost wages can include job retraining and loss of earning capacity. You may even receive damages for wages which you had not yet earned, but had expected to earn at some point in the future.

Often, damages for future earnings are granted in a lump sum, which is discounted from the original damages claim to a smaller amount which may equal the damages claim if invested wisely. For instance, if you were projected to have lost $1 million in future earnings, then you might be awarded a smaller amount, such as $500,000, which the court has calculated to be worth $1 million over your lifetime if invested properly. This is done so as to diminish the financial burden on the defendant, without diminishing the award given to the victim of the accident.

Aside from medical expenses and lost wages, economic damages also include property damage. For instance, if you were involved in a car accident, and your car was damaged or destroyed, then you are entitled to compensation for the replacement of the car or its repair.

car accident damagesThis can go a couple of different ways, depending on the extent of the damage done to your car. If your car was damaged, then you may receive compensation for repairing the vehicle to the condition it was in before the accident. You are also entitled to the value of any other objects that were damaged in your car at the time of the accident.

If the damages cost more than the value of the car itself, however, you may only receive compensation equivalent to the value of your car. The value of your car is decided based on its fair market value. If there is a dispute over the fair market value, you can take the vehicle to an independent mechanic to determine its value. If the car has been totaled, but its fair market value is less than what you owe in car loans, then you must still pay the difference to the finance company out of pocket.

Noneconomic Damages

While it is fairly easy to place an economic value on medical bills, lost wages, and property damage, other types of damages are not as easily calculated, even though they are just as legitimate. These are known as noneconomic damages. Noneconomic damages cover such factors as pain and suffering, inconvenience, physical impairment, disfigurement, and emotional distress and mental anguish.

car accident injuriesNoneconomic damages can be significant, and often constitute the majority of damages awarded in an accident case. However, there are a few types of cases in which the plaintiff is barred from receiving noneconomic damages. For instance, if you were found to be driving under the influence of alcohol or drugs, then you are not allowed to receive economic damages, even if the accident was entirely the fault of the other party. The mere presence of alcohol or drugs in your system, regardless of whether they played a role in the accident, means that you are limited to collecting only economic damages in the case.

Similarly, if you were in an accident and the other party was at fault, but you were unable to establish proof of insurance, then you are ineligible to receive any noneconomic damages. This is why it is important that you are insured to the minimum coverage limits required by the state of California. You must be insured whether you are driving your own vehicle or that of another person.

There is only one exception to this rule: if you were driving while insured, but the other driver was convicted of driving under the influence, then you may receive noneconomic damages. Even so, don’t rely on the other driver being drunk! If you are driving a motor vehicle, it is absolutely critical that you obtain the minimum legally mandated insurance coverage.

How to calculate pain and suffering?

That’s somewhat subjective.

Pain and suffering are a type of noneconomic damage, so unlike damages for medical expenses or lost wages, there is no precise monetary value that can be placed on pain and suffering. Each individual has a different threshold of pain and suffering, and each will suffer differently because of a particular injury, and so damages based on pain and suffering vary widely from case to case.

defective bone replacementCalculating pain and suffering is made even more complicated by the fact that it can include both physical pain as well as mental and emotional suffering. Physical pain includes injuries to the body, which can range from trivial (bumps and bruises) to severe and life-changing (third-degree burns, amputations, or chronic injuries). Physical pain, even if it does not have a clear economic price, is still relatively easy to prove in court, and to convince a jury to take seriously.

Mental and emotional suffering is another matter entirely. Factors which affect the amount of damages given for mental and emotional suffering can include fear at the time of the injury, apprehension as to its effects, and various symptoms associated with post-traumatic stress disorder (PTSD) including headaches, nausea, insomnia, chronic anxiety, and the development of phobias associated with the accident. In cases where an accident has caused physical disfigurement, mental and emotional suffering can also include such factors as embarrassment, ridicule, and humiliation.

Mental and emotional damages can, in many cases, be as bad as (if not worse than) physical pain, and if you have suffered such damages, you deserve to be compensated. Unfortunately, damages for mental and emotional suffering can be more difficult to obtain than damages for physical pain. Because such brain injuries are not as readily apparent as physical injuries, juries are more likely to be skeptical of their existence. Lawyers who wish to prove mental and emotional damages often face an uphill battle. Fortunately, with recent advances in psychology, these types of damages are becoming easier to demonstrate.

How much time is allowed to file a personal injury claim?

The time period within which you must file a personal injury claim is contingent upon something known as the statute of limitations. The statute of limitations is the period of time within which a lawsuit must be filed after an accident occurs.

Although this can pose problems for the plaintiff in such a lawsuit, this is done for a good reason: evidence tends to deteriorate over time. Physical evidence decays and eyewitnesses’ memory starts to fade. The statute of limitations is meant to decrease the cost to the personal injury court system and eliminate cases which are so old that they might be difficult or impossible to solve.

There are a number of different statutes of limitations, which apply to different types of civil cases, as well as most crimes (except for the most serious crimes such as murder). However, the statute of limitations for automobile accident personal injury claims in California is two years. Property damage may be recovered three years after the accident, and the statute of limitations for an accident involving a government entity is six months. If the claim is a wrongful death claim, then the statute of limitations begins to count down on the date of the death, rather than the date of the accident, if the two are different.

So, if you have a personal injury accident claim, you must file it within this period. When should you file this claim? This depends on a variety of factors. It is best to file the claim relatively soon after the accident, because evidence does decay with time, and because if you file your case too close to the statute of limitations, and your case has an error and must be re-filed, then you risk losing your chance to sue altogether. However, sometimes it is necessary to wait and gather evidence and information before filing an accident claim. In short, you should do what is necessary for your particular case, but be mindful of the statute of limitations and do not miss your opportunity.

How to file a personal injury lawsuit?

If you are considering filing a personal injury lawsuit, then the first thing you should do is speak to a lawyer. Even for seemingly simple cases, the legal system is incredibly complex. No untrained individual, no matter how intelligent, can handle a lawsuit on their own without extensive preparation.

Lawyer Reza TorkzadehSo if you are considering such a lawsuit, talk to a lawyer. It will be well worth the hassle. If you are concerned that you cannot pay attorney fees, keep in mind that many personal injury lawyers charge clients on a contingency fee basis, which means that the client pays nothing unless they win the case or receive a settlement, at which point they pay the attorney a percentage of the money won in the judgment or settlement.

Even before speaking to an attorney, however, you should start preparing for an lawsuit immediately after an accident occurs. Write down notes describing what happened while your memory is fresh. Take photos of the accident, if you can. Talk to any witnesses while they are still at the scene, and get their contact information so that you can talk to them later. Carefully document expenses, because they will be used to calculate your damages later. Be careful with what you say about the accident, either in person or on social media, because even if you are in the right, a careless turn of phrase can be used as evidence against you.

You should also inform the other party that you are planning to file a lawsuit. This is not a legal requirement, but it is a good idea because it may allow you to resolve the matter more quickly.

Keep in mind that, if you are trying to seek damages for a car accident, a lawsuit will probably not be your first step. Because drivers are usually insured, your first step will likely be to file an injury claim with the other party’s insurance company. Then, you must negotiate with the insurance company’s adjusters. This is often difficult, because insurance adjusters are trained at their job and skilled at obtaining a favorable settlement for the insurance company, which is another reason why it pays to have an attorney in your corner fighting for you.

If a settlement cannot be reached, then the case may go to arbitration, which is somewhat like a court case but much cheaper, and involves a third-party arbitrator. If this option also fails, then the case will become a lawsuit, and be decided in court.

Limitations of Liability

If you are involved in an accident caused by another person, generally you are not limited to the amount of money you are entitled to receive, subject to proof of injury, lost wages, pain and suffering, and so forth. There are generally two broad types of damages that a person who has been injured in a motor vehicle accident can receive: pecuniary, or “economic,” losses, and non-pecuniary, or “non-economic” damages. However, there are three situations in which your recovery may be limited.

Economic damages relate to out-of-pocket costs, expenses on which you can put a certain monetary figure. The two major types of economic damages are medical expenses and lost wages. For example, medical expenses include the costs of paramedics; ambulance transportation to the hospital; emergency room treatment; time and treatment in a hospital, including all hospital room fees, nurses, doctors’ visits, and medications; follow-up care with the doctor; rehabilitation and physical therapy costs; psychological counseling costs; costs of medical devices; wheelchair costs; prosthesis; the cost of a special bed or equipment to get you in and out of bed; and future medical expenses that will be reasonably necessary for the rest of your life that were caused by the accident.

Another element of economic damages involves lost wages. This includes not only the time you were off work because of your injury, but future damages for wages you would have earned had you not been injured; retraining for a new job if you can’t return to your old job; loss of earning capacity if you are unable to return to work at all or are able to return to work but only at a lower-paying job. When a person suffers an injury that affects his or her ability to work in the future, a lump sum of money is recoverable to compensate him or her. This lump sum is “discounted” to an amount that, if invested wisely, would compensate the injured person for the damages he or she would have made but for the injury. For example, if a person would have made $1 million over the remainder of his or her working life, the person is awarded a lump sum of money (such as $600,000) that, when invested properly, will yield $1 million over his or her working life had he or she not been injured.

Non-economic damages refers to damages that are not easily calculable such as medical expenses and lost wages. The major type of non-economic damage is pain and suffering, which varies greatly between individuals and types and severity of injury. Other non-economic damages include inconvenience, physical impairment, and disfigurement. Non-economic damages also include such things as comfort, society, affection, intimacy, ability to engage in sexual relations, play catch with your children, and other intangible activities that we hardly give a thought to until we are injured. In many cases, non-economic damages for pain and suffering constitute the bulk of the award.

In certain instances, an injured victim is entitled to recover only economic damages and not non-economic damages. Foremost among these situations is when the victim gets into an automobile accident that was not his or her fault, but he or she was convicted of driving under the influence (DUI). In such a case, the driver is barred from recovering non-economic damages and is limited to recovering only economic damages, even though he or she was in no way responsible for the accident.

Another situation in which a person is prohibited from getting non-economic damages is when he or she was the owner of a vehicle involved in the accident, but could not establish his or her financial responsibility (proof of insurance) as required by California law. In California, a person driving his or her own car must prove that he or she has an automobile insurance policy in effect that provides at a minimum $15,000 coverage per person injured in the accident, to a total of $30,000 of the accident (regardless of how many people are injured or killed in the accident), and property damage insurance with a minimum coverage limit of $5,000. This is typically known as the standard “15/30/5” policy.

If you are injured in a motor vehicle accident and do not have at least this minimum policy, you are prevented from recovering from the guilty party monetary damages for your pain and suffering and other non-economic damages. There is one important exception to this rule: If you were driving your own car but did not have insurance, you may still recover damages for non-economic losses if the person who caused the accident was convicted of driving his or her car while under the influence of alcohol or drugs.

The third situation in which you are banned from recovering compensation for your non-economic losses are when you were the driver of any vehicle involved in an accident and you cannot establish you have at least the minimum insurance coverage as required by California’s financial responsibility laws. As you can see from the above, it is absolutely critical that you obtain minimum insurance coverage if you will be driving your own or someone else’s vehicle on California roads.

More Compensation Questions?

Compensation in accident and injury cases is a complicated topic that can raise a lot of questions. We answer many of the most common accident compensation questions that we receive here. If you still have questions otr would like to speak directly with an accident lawyer, we provide free, no obligation case consultations. Our attorneys will happily answer any questions you have about your case. Call us tollfree (888) 845-9696.