An important part of every personal injury case is calculating the value of your claim. It’s impossible to say without knowing your specific situation, but insurance adjusters frequently use the same techniques and focus on the same essential elements when evaluating a claim.
What an Insurance Company Has to Pay Out
To figure out how much your claim is worth, you must first understand what kinds of damages you could be entitled to get compensation for in the event of an accident or injury.
When someone is judged to be at fault in an accident, his or her liability insurance company is responsible for paying for the following expenses for the injured person:
- Medical care and associated costs
- Earnings lost as a result of the accident, such as lost wages due to time away from work or treatment for injuries, or disfigurement. Loss of family, social, and educational experiences, such as missed classes or training, vacations or recreation, or a special event. “Pain and suffering.” and emotional damages such as stress, embarrassment.
Damages Calculation Formula for the Insurance Industry
It’s easy to tally up the money spent and money lost when figuring out compensation, but it’s much more difficult to quantify things like pain and suffering, missed chances, and missed experiences. This is where the damages formula of an insurance company comes in.
When negotiating a personal injury settlement, an insurance adjuster will often start by adding up all of the medical bills linked to the accident. Medical special damages, or “specials,” are the terms used to describe these costs. With that number, the adjuster can determine how much to pay the injured party for non-economic damages such as pain and suffering and other intangible losses, known as “general” damages.
If the injuries are minimal, the adjuster may increase the amount of special damages by 1.5 or 2. In cases where the injuries are severe or long-lasting, the adjuster has the option to increase the amount of exceptional damages by a factor of five.
If the adjuster is employing a formula, this may be the end of it. Medical specialties are multiplied by a number between 1.5 and 5, then added to lost income to arrive at this number. However, this is not the ultimate compensation sum; rather, it is the starting point for compensation negotiations. Find out how to deal with the insurance company while negotiating a personal injury settlement.
Calculating the Percentage of Fault attributable to Each Party
Whether or whether the insurance company will pay depends largely on how much each party contributed to the original accident. The damages formula offers you an idea of what your injuries might be worth, but you won’t know the true compensation value of your claim (according to injury law) until you factor in the issue of fault.
In most cases, you and the insurance adjuster will at least have a good notion of whether the insured person was fully at blame, or whether you were little at fault, or if you were significantly at fault. Whatever your comparative culpability percentage is, it will be subtracted from the damages formula total to arrive at a final value of 10 percent, 50 percent, or 75 percent. Learn how to determine who was at fault in an accident.