How Much Is a Personal Injury Settlement?
Getting hurt in an accident can put you under significant financial strain. You have unplanned medical costs to contend with, your wages drop due to your temporary (or permanent) inability to work because of your injuries, and you struggle to keep up with your day-to-day expenses. All because someone else’s wrongful actions left you injured.
A personal injury claim can compensate you for your injuries and losses. But just how much can you expect to receive? The answer varies widely from case to case. Numerous factors can influence the amount of your financial recovery for a personal injury. A Phoenix personal injury attorney can help you determine the best course of action to take in your situation.
Personal Injury Settlements Explained
Non-lawyers think of a personal injury “settlement” as any payment they receive for their injuries and losses. But for lawyers, that word has a more specific meaning.
In legal circles, a personal injury settlement is an agreement between the injured party (you) and the party or parties with legal liability for causing you harm. In the typical settlement, the liable party or its insurance company pays you an agreed-upon sum. In exchange, you agree to release that party and its insurer from further liability to you and to dismiss any lawsuit you have filed against them.
Most personal injury cases end in settlements before trial. But not all do. A settlement requires you and the liable party to agree to resolve your claim. Sometimes there’s no agreement to be had—typically because the liable party refuses to pay you a fair amount for your damages. When that happens, your personal injury case may go to trial in a courtroom, to be decided by a judge and jury.
Parties in a personal injury case often prefer the certainty and finality of settlements to leaving it up to a judge and jury to decide how much (if anything) the injured party should receive. In most personal injury cases, a settlement reflects a balancing of what the law entitles the injured party to claim as damages on one hand, against the probability of the liable party being ordered by a court to pay and actually paying that amount on the other.
What can you claim as damages?
The starting point for determining the size of a personal injury settlement is to analyze how much you have the legal right to claim as damages. In most personal injury cases, you have the right to claim two broad categories of damages: economic and non-economic. You may also have the right to claim two other types of damages, called statutory and punitive. We examine each below.
Economic damages, also known as special or monetary damages, reflect the financial harm caused by a personal injury.
They typically include:
- Your past and expected future medical expenses for treating your personal injury and any health complications it causes, including emergency treatment, hospital and rehab stays, surgeries, therapies, medications, medical equipment, and in-home care.
- Your past and expected future non-medical expenses that flow from your accident and injury, including costs of repairing or replacing damaged property, modifying your home to accommodate a disability, or hiring replacement services (like transportation or childcare) to offset your loss of mobility or independence.
- Wages you did not earn while taking time off from work to heal from your injuries, including the value of vacation or sick days you consumed.
- Income you probably will not earn in the future because of your injury or any disability it causes, including the value of potential earnings in a job you can no longer hold or a career you can no longer pursue.
Lawyers, insurance companies, and courts typically determine economic damages by adding up your documented past expenses and wage losses, and then making reasonable estimates of your future costs and lost income in light of your age, health, and other relevant factors.
Non-economic damages, also known as general damages, reflect the many other ways, aside from financial, that a personal injury can negatively affect your life.
They usually consist of:
- The physical pain and discomfort caused by your injury and any health complications it causes, including the pain of the initial trauma, of surgeries and treatments, and of living with a chronic injury or disability.
- The emotional suffering and mental health challenges resulting from your injury and any health complications it causes, such as depression, anxiety, substance abuse disorders, or post-traumatic stress (PTSD).
- The inconvenience and loss of independence resulting from living with a personal injury or a disability resulting from it.
- The interference with personal relationships flowing from a personal injury, such as loss of consortium with a spouse or a diminished ability to interact with family and friends.
- The overall loss of quality and enjoyment of life owing to a personal injury.
Determining an amount of non-economic damages involves a more nuanced and subjective inquiry than tallying up economic damages. Attorneys, courts, and insurance companies sometimes use shorthand methods to come up with this figure, such as multiplying economic damages by a factor from 1 to 5 based on the severity of an injury, or coming up with a per diem value for non-economic damages and multiplying it by the length of time those damages will persist.
No method for calculating non-economic damages is perfect or perfectly accurate, however. The amount you have a reasonable shot at receiving through a settlement often depends on the skill of and experience of the personal injury lawyer that you hire.
A personal injury resulting from someone else’s conduct that violated a federal or state statute may entitle you to seek statutory damages as part of your claim. These are damages spelled out specifically in a law as the penalty for illegal conduct that causes harm. For example, a consumer protection law might establish minimum damages for violations relating to the manufacture or sale of defective products. An experienced personal injury lawyer can research the law applicable to your case to determine if you have a claim for statutory damages.
Personal injuries sometimes result from someone else’s extraordinarily reckless or intentionally harmful conduct. In those cases, the law generally allows you to seek what are known as punitive (or exemplary) damages from the at-fault party. These damages aim to punish the wrongdoer, rather than to compensate you. A skilled lawyer can evaluate your case to determine if you may have a viable claim for punitive damages.
What is the realistic settlement value of your claim?
So far, we’ve described the injuries and damages you may have the legal right to claim for a personal injury. Their combined total represents the maximum amount the law allows you to demand from the at-fault party and that party’s insurer. In an ideal world, it’s also what you would receive if you have a slam-dunk, uncontested case and the at-fault party has the financial resources to pay you in full.
But we don’t live in an ideal world. In most personal injury cases, a gap exists between the legally valid amount of your personal injury claim on one hand, and how much you can realistically expect to achieve through a negotiated settlement on the other. After all, a settlement is an agreement reached (usually) through both sides making compromises.
Three primary factors influence the amount you can reasonably expect to receive through a personal injury settlement.
The Strength of Your Case
Personal injury cases rest on a foundation of evidence and legal arguments constructed to prove that you deserve to receive compensation for your injuries and losses. The more solid that foundation, the better the chances of achieving a favorable settlement.
The strength of your case can depend on:
- The amount of supporting evidence available for your lawyer to collect, review, and present;
- The existence of contrary evidence that undermines your allegations against an at-fault party;
- The clarity and definiteness of the legal principles applicable to your claim;
- The emotional or practical appeal of your case to a hypothetical jury.
The strongest claims leave no room for doubt about who should pay you and how much they should pay. As doubt creeps in, the potential settlement value of a case tends to drop.
The Quality of Your Personal Injury Lawyer
A personal injury claim does not materialize out of thin air. It’s built, piece by piece, by a personal injury lawyer. The skill, reputation, and experience of that lawyer can have a significant impact on the potential settlement amount you can achieve.
Your choice of a lawyer can directly affect the strength of your personal injury case. The most talented and resourceful lawyers know how to locate and exploit critical evidence and to construct powerful, sophisticated legal arguments. Never assume that all personal injury lawyers are the same. More often than not, better lawyers build stronger claims and get higher settlements.
After constructing a personal injury claim, a lawyer’s job is to present it in the most persuasive manner possible. Here, too, choosing the right attorney can make a huge difference. Two lawyers might build cases of identical strength, but the more creative, forceful, and respected advocate of the two will tend to get you better results in settlement negotiations.
Always try to choose a lawyer who has experience representing individuals in personal injury cases similar to yours, a strong reputation in the community where your injury happened, and a track record of success for injured clients like you.
The Other Side’s Ability to Pay
You can’t get blood from a stone. No matter how strong your case or how good your lawyer, don’t expect to settle your personal injury claim for more than the at-fault party has the ability to pay. Insurance policy limits and the scope of the at-fault party’s assets can effectively cap your personal injury settlement amount.
Of course, that doesn’t mean that you have to take the at-fault party’s word for it when they plead poverty. Sometimes more than one party may owe you damages or multiple insurance policies may cover your claim. Sometimes parties try to hide their assets to avoid having to pay you what they owe. A skilled personal injury lawyer investigates all potential sources of payment for your injuries and losses to make sure you achieve the maximum available financial recovery in your case.
Tips for Achieving a Favorable Personal Injury Settlement
To enhance the chances of securing the best possible settlement in your case, follow these tips.
Seek Medical Care
The most favorable personal injury settlements tend to go to individuals who do everything they can to take care of themselves after getting hurt. Delaying a doctor visit or failing to follow medical advice can harm the value of your claim and force your lawyer to play defense. After any personal injury, go to the doctor immediately and stick to your treatment plan.
Never Try to Handle Settlement on Your Own
You cannot realistically hope to settle your case for the maximum available amount by acting as your own lawyer. Defense lawyers and insurance adjusters will take advantage of your lack of experience to undercut the value of your claim. They will not take your case seriously or treat you fairly. Personal injury victims who make the mistake of trying to negotiate their own settlements virtually always end up with far less settlement money than they would have received if they had left negotiations to a skilled personal injury attorney to handle on their behalf.
Contact a Skilled Personal Injury Lawyer Immediately
Your rights to compensation for your personal injury may depend on taking swift action to secure evidence or notify others of your claim. If you wait too long to connect with an experienced personal injury lawyer, you could miss a critical deadline or undermine your lawyer’s ability to negotiate the most favorable settlement possible in your case.
So, don’t delay. To learn about the potential settlement value of your personal injury claim, contact a skilled personal injury lawyer today for a free case consultation.