When you're making a claim for injuries, vehicle damage, and other losses after a car accident, putting a dollar amount on everything isn't an easy task. There is no precise formula, but there are a few key variables that car insurance companies and lawyers often focus on in order to assess the value of a car accident case, so let's take a look at what goes into a typical valuation. (For answers to another common question from claimants, learn more about when you can expect a car accident settlement.)
Car Insurance Coverage and Policy Limits
Whether or not the at-fault driver has car insurance coverage -- and the policy limits associated with that coverage -- often plays the biggest role in the amount of compensation you can expect to see in your car accident injury claim. That's usually true when it comes to any settlement the at-fault driver's car insurance company offers you. The policy limits will serve as a de facto cap on your settlement. But it's also a big factor in the rare instance where a car accident lawsuit goes to trial. Even if the jury awards you damages that exceed the at-fault driver's car insurance policy limits, you'll have to hope that the driver has sufficient personal assets to satisfy the judgment.
For example, if the at-fault driver’s liability insurance policy limit is $50,000, you can only recover a maximum of $50,000 from his or her insurance company, even if you can prove that you sustained damages in excess of that amount. In order to recover the difference, you would have to either sue the other driver or make a claim under your under-insured motorist coverage, if you have it. Learn more about how insurance coverage affects a car accident case.
Right or wrong, it's standard practice for an insurance company to assess vehicle damage and factor that in when determining injury claim value. If your car was barely damaged, the insurer is going to argue that you couldn't have been hurt all that seriously.
Pretty much any medical bills you receive for treatment of your car accident injuries will be included in your damages. This total amount of medical expenses will factor heavily into the calculation of other types of damages that aren't so easy to quantify, like pain and suffering, which we'll discuss below. Learn more about how medical treatment affects settlement value.
Lost Income/Earning Capacity
Any income you have lost and any future income you lose (loss of earning capacity) because of the car accident is recoverable as compensatory damages, and will be taken into account when determining the value of your case.
Pain and Suffering
"Pain and suffering" includes compensation for physical pain and discomfort stemming from the accident, your injuries, and your medical treatment. It also encompasses mental and psychological effects like anxiety, fear, loss of sleep, even post-traumatic stress disorder.
While pain and suffering damages aren't easy to capture with a dollar figure, they can make up the biggest category of damages in a car accident case, especially one where injuries were serious and medical treatment was extensive.
While it's true that there's no formula for assessing car accident injury claim value, it's standard practice for insurance companies to use a "multiplier" when calculating "pain and suffering" damages, usually a number between 1.5 and 5 or 6 (1.5 for minor injuries, 5 or 6 for permanent disability). That figure is then multiplied by the injured person's total medical bills incurred, to arrive at a number for "pain and suffering" damages.
Learn more about how pain and suffering is calculated in a car accident case.
Loss of Consortium/Loss of Enjoyment
Loss of consortium is a term that is used when a spouse is injured in an accident and his or her partner loses the spouse’s physical companionship and support. The impact on the relationship between spouses is what determines the appropriate amount of compensation. Note that loss of consortium damages are awarded directly to the affected spouse, not to the injured plaintiff, and only if the injured plaintiff is successful in his or her main claim.
If the injuries you sustained as a result of the car accident affected your ability to enjoy the day-to-day pleasures of life, or if they limit or prevent you from participating in the hobbies and interests you enjoyed before the accident, you may be entitled to compensation for “loss of enjoyment.”
How Your Conduct Can Affect Your Case’s Worth
A final consideration in figuring out how much your case is worth is your own conduct. If the accident was partially your fault, don't be surprised if the insurance company substantially lowers your settlement offer. A jury can likewise find in favor of the defendant or reduce any potential award by your proportionate fault if you're found to bear some level of liability for the car accident, depending on what your state's law says about the issue of shared fault (these are known as "comparative negligence" or "contributory negligence" laws).
If you're thinking about making a car accident claim and you'd like a detailed estimate of the potential value of your case based on the damages you've incurred, it's time to reach out to an experienced attorney. Learn more about a free consultation with a car accident attorney.