Economic vs. Non-Economic Damages in a Car Accident Claim

When it comes to car accident claims, there are two types of damages that can be sought: economic and non-economic.

Economic damages refer to the monetary losses a person has incurred as a result of the accident, while non-economic damages refer to the emotional and physical harm that a person has suffered.

Both types of damages are important to consider when filing a car accident claim, and both can significantly impact the outcome of the case.

Economic Damages

Economic damages refer to the monetary losses a person has incurred as a result of the accident. These damages can include:

• Medical expenses: This includes any costs associated with medical treatment, including hospital stays, surgery, and rehabilitation.
• Lost wages: If a person is unable to work as a result of the accident, they may be able to recover lost wages.
• Property damage: If a person’s vehicle or other property was damaged in the accident, they may be able to recover the cost of repairs or replacement.
• Future lost earnings: If a person’s injuries are such that they are unable to return to work or their earning capacity is impaired, they may be able to recover future lost earnings.
• Loss of consortium: If a person’s injuries have a negative impact on their relationship with their spouse or partner, they may be able to recover damages for loss of consortium.

Economic damages are generally easier to quantify than non-economic damages, as they are based on specific expenses and losses. However, it is important to keep in mind that economic damages can also include future losses, which can be more difficult to calculate.

Non-Economic Damages

Non-economic damages refer to the emotional and physical harm a person has suffered due to the accident. These damages can include:

• Pain and suffering: This includes physical pain and emotional distress that a person has experienced as a result of the accident.
• Loss of enjoyment of life: If a person’s injuries have a negative impact on their ability to enjoy life, they may be able to recover damages for loss of enjoyment of life.
• Mental anguish: If a person has experienced emotional distress as a result of the accident, they may be able to recover damages for mental anguish.
• Scarring and disfigurement: If a person’s injuries have resulted in scarring or disfigurement, they may be able to recover damages for these injuries.
• Loss of companionship: If a person’s injuries have a negative impact on their relationship with their spouse or partner, they may be able to recover damages for loss of companionship.

Non-economic damages can be more difficult to quantify than economic damages, as they are based on subjective experiences and feelings. Additionally, unlike economic damages, non-economic damages are not limited to the costs of medical expenses or lost wages.

How Economic and Non-Economic Damages are Calculated

The calculation of economic damages is typically straightforward, as it is based on expenses and losses that have already occurred or can be reasonably estimated. Medical expenses, lost wages, and property damage can all be calculated based on bills, receipts, and other documentation.

Future lost earnings may be more difficult to calculate but can be done by considering factors such as the person’s age, occupation, and earning capacity before the accident.

On the other hand, the calculation of non-economic damages is more complex and subjective. Pain and suffering, mental anguish, and loss of enjoyment of life are not tangible expenses and can vary greatly from person to person.

The amount awarded for non-economic damages can also vary depending on the injuries’ severity and their impact on the person’s life.

Multiplier Method

A common method used to calculate non-economic damages is to use a multiplier. This involves taking the total amount of economic damages and multiplying it by a number (usually between 1 and 5) to arrive at the total amount of non-economic damages.

For example, if the total economic damages are $50,000, a multiplier of 2 would result in $100,000 in non-economic damages.

Per Diem Method

Another method is to use a per diem approach, which involves awarding a specific dollar amount per day for the duration of the person’s recovery.

For example, if a person is expected to recover for a period of 6 months, and the per diem rate is $100 per day, the total non-economic damages would be $90,000.

It is important to note that the calculation of non-economic damages is not an exact science, and the amount awarded can vary greatly depending on the specific circumstances of the case.

Finding Representation for Your Claim

In conclusion, when it comes to car accident claims, it is important to understand the difference between economic and non-economic damages, as both can have a significant impact on the outcome of the case.

Economic damages refer to monetary losses, while non-economic damages refer to emotional and physical harm.

Both types of damages are important to consider when filing a car accident claim and it is important to have proper representation from a car accident attorney who can help you to calculate the amount of damages you are entitled to.