Every time someone contacts a lawyer regarding an injury, one of the first questions is: How much money can I expect to get?
When you file a claim with an insurance company after an accident of any sort, you are essentially asking them to give you money to help take care of you while you recover. How much you seek and why you seek it will vary from case-to-case. But what you might not realize is that many insurance companies use a fairly standardized formula to determine how much you should be offered.
After an accident, you may be entitled to damages for the following
- Medical costs and hospitalization
- Property repair or replacement
- Missing or lost income
- Emotional trauma – including including pain and suffering and future pain and suffering
Insurance companies begin by looking at the first and arguably most important form of damage: medical bills and property damage. These are called, “actual damages” because they are out of pocket expenses that are charged to you immediately. The cost to help you recover is easily represented and understood because it is right there at the bottom of your receipt from the hospital. The cost of your emotional damages is abstract, and requires a different calculation.
To reach an amount of compensation for the abstract concept of your pain and suffering, as well as future pain and suffering, an insurance company may take the cost of your medical recovery and multiply it by any number between 1.5 and 10.
The more severe your injury, the longer it is expected to last, or how devastating the accident was at a glance, the higher the number.
The result is how much compensation they might offer you upfront. Example: Your medical cost is $50,000 after another driver flipped your car. The experience was clearly rattling and caused you a great deal of pain. The insurance company offers you $50,000 for your medical bills plus another. Depending on the extent of the damage, the insurance company begins to calculate your lost wages and property damage. Lets say you lost 6 months of work, and get paid $2,000 per month, and the value of your car was $20,000. At that point, the insurance company pays you $24,000, plus the loss of your car at $20,000. The current total is $94,000
The final number is pain and suffering, as well as future pain and suffering. Even taking a 2x calculation, which is on the low end of the spectrum, you would be entitled to $188,000.
Because it is vital that this calculation is done properly, hiring a lawyer who understands how insurance companies work and the tricks they use is not only recommended, it is a necessity. See our blog post about why you should hire an attorney.