How the Court Determines Compensation

If you’re needlessly injured because of someone else’s careless act, you have a right to file a personal injury lawsuit seeking damages (financial compensation) for your losses. What types of damages are available? How are they calculated?

The Different Types of Damages

At the broadest level, damages in a personal injury lawsuit are identified as either compensatory or punitive. Compensatory damages, far and away the most common, are designed to make you whole again, to reimburse you for your losses. Punitive damages, which are exceptionally rare in personal injury lawsuits, are designed to punish the defendant for particularly egregious behavior. They are also intended to serve as a disincentive for others to engage in similar behavior.

At a practical level, compensatory damages fall into two categories: economic \ and non-economic.

What Are Economic Damages?

Economic damages are those that are tangible and easy to ascertain, usually represented by actual expenses incurred, loss of property value, and/or loss of the ability to generate income. Unreimbursed medical expenses are a common form of economic loss, as are lost wages and other income. Economic damages can include future losses—for example, if you’re permanently unable to work.

What Are Non-Economic Damages?

Non-economic losses carry no definite numerical value. The common losses for which non-economic damages are available include:

• Physical pain and suffering
• Loss of consortium or companionship
• Loss of enjoyment of life

Because these damages are not tied to specific financial gain or loss, jurors have more latitude (subject to review by the judge) when calculating them. Factors that typically come into play include the age of the injured party, the lifestyle they had before the accident, and the severity of the injury.