The purpose of damages in a personal injury case is to make you, the victim, whole again after your injury. Most of the time, damages replace the financial burden of your injury. While no amount of money can make up for permanent disability, emotional trauma, or even the loss of a loved one, it is the only way the courts have to punish a person for their negligent acts while also helping the victim.
Past expenses, such as medical expenses you have paid, prescriptions you have purchased, and medical equipment you paid out-of-pocket are easy to compute. Wages you lost taking time off of work to recover, visit the doctor, or even go to court are also easy to calculate.
Future expenses, however, are not as easy. These require an attorney to work closely with an accountant and economist to project your costs, including medical expenses, lost income, and pain and suffering. These future damages ensure that you do not pay out-of-pocket for your injury – even if you are still recovering 10 years after the fact.
Why Future Damages are Critical for a Personal Injury Claim
When your injuries are catastrophic, you may have years of recovery ahead. You might require multiple doctor’s appointments, follow-up surgeries, or be permanently disabled, which comes with a whole host of costs – including lost wages.
It is imperative that an attorney factor in your future costs when they propose a settlement to an insurance company. After all, what good is a settlement if you must pay out-of-pocket for the rest of your life for an injury you did not cause ?
It is your attorney’s job to get the compensation you deserve for all expenses, including those in the future. Therefore, when you meet with your injury attorney, make sure that they are considering the future expenses of your injury in the settlement.
What Future Damages Can You Collect?
Damages typically projected in a personal injury case include medical expenses, lost wages, and pain and suffering.
Future Loss of Earning Capacity
If you will miss work due to ongoing medical treatments, permanent disability, or you are unable to continue working at your current job, these consequences matter. Your attorney will project the earnings you would have made if you were not injured, and include those in your settlement request.
Future earnings are awarded in cases of permanent disability or long-term recoveries.
How Are Future Earning Losses Calculated?
Your future earnings and losses are not calculated based on your current income; because in the future, you would likely earn different wages. Instead, the law looks at your ability to earn a living.
First, your attorney estimates your earning capacity prior to the injury. Then they compare that to the reduction in earning capacity from your partial or complete disability. Your damages are then based on the difference between the two.
If your injury severely inhibits your ability to work and thrive in the future, the purpose of your loss of earning capacity is to ensure that you do not suffer financially as a result.
Note, you do not have to be employed at the time of your accident to claim a loss in future earning capacity. If you are in between jobs but would have been able to find a job and earn money in the future had you not been injured, you still qualify for a loss of earning capacity.
Future earning capacity is a powerful form of future damages – and often increases a person’s settlement by hundreds of thousands to millions of dollars. When you are compensated for the income you would receive for your earning years, you might receive compensation for this type of settlement spread out in payments over the next few years – rather than a lump sum.
Future Medical Expenses
Medical expenses are costly, and when you have a severe injury that requires future surgeries, physical therapy, and years of medical treatment, the compensation can be extensive.
In personal injury cases, medical expenses do not have a minimum or maximum allowed. This is because the courts assess your injury on a case-by-case basis. They look at the costs of your treatment, your prognosis, and the expenses associated with your diagnosis.
For example, say you have been badly burned in an accident. Your physician recommends a series of surgeries over the course of several years to reconstruct your face and help you recover. While you will be permanently scarred, the surgeries will help restore your face as much as possible, and prevent infection. These surgeries are expensive but required. Therefore, your attorney would calculate the amount of each procedure, including potential inflation costs, and include that expense in your compensation.
What Future Medical Expenses Can be Included in a Settlement?
Any future medical costs associated with your injury could potentially be included in the settlement. This includes:
- Hospital Bills: If future surgeries are part of your prognosis, you will obviously stay at the hospital – and that stay could be over several days for each surgery. All expenses associated with your hospital stay are included in the estimate.
- Surgery Costs: Any future surgeries are estimated and projected.
- Diagnostic Tests: To monitor your progress or as part of a pre-op procedure, you will have diagnostic tests, including laboratory work, medical scans, and other tests. The cost of these tests is included in your settlement.
- Prescription Medications: You might require prescription medications for the rest of your life, and prescriptions are expensive. Therefore, your attorney will calculate the costs of those prescription medications.
- Therapy and Rehabilitative Costs: You may require several months of physical therapy, vocational therapy, or psychotherapy to recover from your injuries. The costs of these, including recommended appointments in the future, are included in your calculation.
- Medical Equipment: Some injuries require medical equipment, such as a wheelchair. These medical costs should be added to your future damages, especially if you will depend on medical devices for several years – or the rest of your life.
- Modifications to the Home: You may be required to modify your home as part of your disability, such as adding ramps to entrances, widening hallways, retrofitting bathrooms, or installing medical equipment.
Future Pain and Suffering
A permanent injury could leave a person with chronic pain for the rest of their life. They may suffer from depression when they can no longer work or enjoy life, and a person’s quality of life, in general, could change dramatically.
When an attorney calculates future damages, they include the physical, emotional, and mental pain of the injury in their calculation.
Calculating Future Physical Pain
To insurance companies, the longer you will suffer from an injury, the more you deserve in pain and suffering damages. Your medical records will indicate how long you will physically suffer from an injury. Typically, this is your estimated recovery time – if you will ever fully recover.
Your physician may estimate that you will recover in six months, while other times an injury could result in long-term, chronic complications. For example, spinal cord injuries are often permanent. You could suffer from pain, breathing complications, and be subjected to painful procedures for the rest of your life. In this case, your physical pain and suffering would be much more than someone who would make a full recovery in less than a year.
Proving Pain and Suffering is Complicated
Pain and suffering is one of the more contested compensation types. Insurance companies frequently argue against your claims, especially if you have chronic pain for what they consider a “minor” accident.
While you can recover damages for pain and suffering, you must prove that your pain and suffering warrants the amount of damages you request. The extent of your injury and medical testimony is often enough to prove pain and suffering. When a physician or multiple physicians testify about the recovery time, severity of your injury, and the pain you suffer, this will help win your case for pain and suffering damages.
What about Multiplier?
Sometimes, insurance companies use multipliers to determine pain and suffering. The multiplier ranges from 1 to 4 (sometimes more). They multiply this by the number of actual damages, including past and future damages to arrive at a total pain and suffering amount.
This is done during the negotiations and settlement phases, but when you go to court, realize that the judge and jury do not use a multiplier to decide your pain and suffering.
Leave the Damage Calculations to an Attorney
Right now, you are recovering from a catastrophic injury. You need time to heal physically and mentally – and the last thing you need to worry about is how to calculate damages. After your serious injury, you need an advocate to help handle the negotiations, collect evidence, and settle your claim with the insurance company.