Every case is different, however, insurance companies and courts must use a basic equation when determining the payout amount for a Personal Injury Claim. They collect an objective list of all expenses incurred from the injury, then add in the more subjective factors to arrive at the final compensation amount.
The first part of the equation isn’t complicated. A sum total of every provable financial expense that was a direct result of the accident or injury is calculated. This includes, but is not limited to:
- Cost of Medical Equipment
- Cost of Medication
- Damaged or Lost Property
- Expenses Paid Out of Pocket
- Hospital Stay
- Lost Wages
- Medical Bills
This gives you a starting dollar amount. These items are the first part of the overall damages. Some courts refer to these quantifiable dollar amounts as Medical Special Damages, Economic Damages, or even just “Specials.” The result of this calculation is easy to prove.
- Emotional Turmoil
- Disruption of Daily Lifestyle
- Loss of Enjoyment
- Loss of Consortium
- Physical Pain
- Recklessness or Gross Negligence (for injuries resulting from another party)
- and of course, Stress
General Damages Multiplier
General Damages cannot be calculated using bills to create a sum total, so insurance companies and courts turn these General Damages into a Multiplier for their compensation formula.This Multiplier can vary from 1.5 to 5 depending on the extent of the General Damages. The worse the General Damages, the higher the Multiplier number will be. This will result in a higher overall payout to the victim.
The Compensation Formula generally looks like this:
$Special Damages x General Damages Multiplier (1.5-5) = $Total Compensation Paid
If Katy suffered from an accident where the provable sum total of her expenses equaled $24,000, that means that her Special Damages number is $24,000.
If Katy suffered nightmares about the accident, plus the emotional distress over driving again, plus she missed out on a possible work opportunity, and her injuries prevented her from enjoying her relationship with her spouse and family, that may earn her a General Damages Multiplier of 2.5.
Katy’s Compensation Formula would be:
Special Damages x General Damages Multiplier = Total Compensation Paid
$24,000 x 2.5 = $60,000
It is important to understand every case is different – and less reputable insurance companies will not divulge they are using a formula to calculate your payout. It may work to your benefit to have this information, but NOT share it. In so doing, the other party will not know if you value your own multiplier the same as they would.
The attorneys at The Law Offices of G. Wayne Van Bibber & Associates have years of Family Law experience and can provide you with additional information in a confidential consultation.
The Law Offices of G. Wayne Van Bibber and Associates