If you have been injured in an auto accident, and you are not at fault or you live in a no-fault state you are entitled to a certain amount of compensation.

Types of Compensation

Insurance companies, lawyers, and legal experts calculate compensation, or damages, via one of two categories . The first involves actual economic or financial loss, including medical bills, lost wages, car repair or replacement expenses, and out-of-pocket costs like deductibles, handicap retrofits to a home or vehicle. These are called special damages.

The second category is general damages, and includes such intangibles as pain and suffering, disfigurement, physical impairment, emotional trauma, reduced quality of life, and ongoing psychological stresses like PTSD.

Measuring Financial Loss

The formula for measuring actual dollar losses as the result of an auto accident/injury is fairly straightforward. Add up medical costs, property loss costs, lost wages, and other strictly monetary expenses, and this will be very close to your special damages settlement.

General damages also known as non-economic damages are difficult if not impossible to calculate in terms of dollars and cents. Recognizing this, insurance companies and legal experts use a multiplier method. Add up all current and future medical expenses, multiply by an average of 3.25, and the result will be in the ballpark of your actual settlement for general damages.

A more complicated method involves multiplying the days during which you suffered by a daily, or per diem rate. This rate is your daily salary: for example, $50,000 per year divided by 250 working days per year, or a per diem rate of $200.

This method loses its value in long-term injury situations because no one can see the future. One person with a compound leg fracture may recover fully in six months. Another with underlying health conditions may never recover. In other words, the defendant the one who caused the injury is responsible for the plaintiff in whatever condition he or she may be.

In that case, the settlement will be based on similar injuries/settlements in your jurisdiction information that only financially successful lawyers can access. This is why it is important to make sure your legal team is highly experienced and skilled at settling auto accident/injury claims.

Statistics on Personal Injury Claims

The U.S. Department of Justice in 2005 completed a study of personal injury cases, with one focus exclusively on motor vehicle accidents, which accounted for a full 52 percent of claims.

They also concluded that of all personal injury categories (medical malpractice, product liability, and premise liability) auto accident plaintiffs were the most successful, in 61 percent of cases. Only 19 percent of medical malpractice plaintiffs succeeded in winning awards.

As the number of personal injury cases climbs year-over-year, insurance companies, judges, and juries tend to grant smaller punitive damage awards. The median settlement in auto accident personal injury cases in 2005 was $16,000. In 2013, the average cost of a personal injury reported rose to $24,000 , which is a significant increase.

Cases are also taking longer to come to trial. Auto accidents average 12 to 18 months, but cases settled out of court also provide less financial relief. Whether you choose to settle, or to go to court, a good attorney is essential to getting a fair award. A bad attorney costs you twice once in legal fees and the second time in loss of compensation through failure to negotiate correctly.