calculating pain and suffering

How Are Pain & Suffering Damages Calculated in a Personal Injury Case?

When a person suffers an injury that is caused by someone else’s negligence, they may be entitled to damages for their losses. This can happen as a result of a number of different types of accidents and events, including:

  • Car accidents
  • Truck accidents
  • Motorcycle accidents
  • Bicycle accidents
  • Pedestrian accidents
  • Nursing home abuse
  • Medical negligence
  • Workplace injuries
  • Premises liability accidents
  • Product liability claims

Compensatory damages from personal injury claims are divided into two general categories: economic damages and non-economic damages. Economic damages are the direct monetary losses that are incurred by the victim. Examples may include hospitalization costs, costs for medical procedures and treatments, rehabilitation expenses, the cost of ongoing medical care, lost wages, lost earning capacity, and property damage.

Determining the amount of economic damages is a fairly straightforward process. These types of damages can be easily calculated by adding up the costs and arriving at a total. Now, this does not necessarily mean that the insurance company is going to compensate you for the sum total of all your monetary losses. For example, they might argue that your injury was caused or at the very least aggravated by a pre-existing condition.

Noneconomic damages represent compensation for the intangible losses that the injury victim suffers. Pain-and-suffering is the most common category of noneconomic damages, and this can include both the physical pain that the victim has to endure as well as the mental anguish caused by the accident or event. There are other damages that may fall into this category as well, such as psychological distress, diminished quality of life, disfigurement, and permanent injury.

Calculating noneconomic damages such as pain and suffering is not nearly as easy as calculating economic damages. These losses are very difficult to quantify, because they are subjective and unique to each individual’s situation. For example, one person may suffer an immense amount of pain and distress from a car accident, while another person may only suffer a minor amount of pain and inconvenience from the same type of accident.

When you boil it all down, no amount of money can really adequately compensate for damages such as pain-and-suffering, particularly in cases in which the injury is long-term. After all, how do take away someone’s pain and give them their life back if there is no medical solution available to accomplish this? Monetary compensation is the best that the legal system can do in civil cases like these.

Methods Used to Calculate Pain & Suffering Damages

There are a couple of different ways that insurance companies might try to calculate pain and suffering damages:

Multiplier Method

One of the more common approaches is to total all of the economic damages and multiply them by a certain number (called a “multiplier”) to calculate the amount of damages that should be paid. The multiplier could be 1.5 on the low end and go up to 4 or 5 (or sometimes higher) on the high-end.

Determining the appropriate multiplier is often a major point of contention. As you might expect, insurance companies will argue that the multiplier should be low, while your attorney will argue that it should be higher. This is one of many reasons that you want an experienced attorney in your corner who is a skilled negotiator and has the proven ability to recover full and fair compensation for their clients.

Per Diem Method

Another approach that might be used to calculate pain-and-suffering damages is the per diem (i.e., “per day) method. With the per diem method, a daily rate is assigned (often based on the victim’s daily earnings) for their pain-and-suffering that goes from the date of the injury until the date in which their doctor says that they have reached maximum medical improvement (MMI). In cases in which there are permanent losses (such as disfigurement or permanent disability), the per diem method is probably not the right approach.

It is important to note that insurance companies are under no obligation to use either the multiplier or per diem approach to calculate pain-and-suffering damages. Some insurers use their own set of algorithms to calculate an appropriate amount, and we all know that the amount they arrive at is likely to be as low as they can get away with.

As we touched on earlier, at the end of the day it all comes down a negotiation. And in order to negotiate effectively, you need to be able to present the strongest possible case, and you need to have leverage. In situations like this, one of the best types of leverage is the credible threat that you will litigate the case if the other side is not willing to negotiate in good faith.

Suffered a Personal Injury in Alabama? Burge & Burge is Here to Help

If you or a loved one got injured through no fault of your own, you might be entitled to significant compensation both for direct financial losses and for intangible losses such as pain-and-suffering. If your injury occurred in Alabama, Burge & Burge is ready to go to work for you! To get started, message us online or call our office today at 205-251-9000 for a free consultation with one of our attorneys.

 

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