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How Do Insurance Companies Calculate Pain and Suffering Damages?

If you sustain injuries and other damages due to another person’s negligence, the at-fault party’s insurance will often cover your damages. While special damages are easily proven, such as medical expenses, lost wages, and property damage, other general damages like pain and suffering are harder to calculate. Different insurance companies use different criteria for awarding pain and suffering damages, so there is no hard and fast rule for determining how much you will receive in pain and suffering damages for your claim.

Proving Pain and Suffering

Pain and suffering are intangible concepts, so how does an insurance company verify such a claim? If you have suffered injuries, your doctor will have likely drawn up a medical report that outlines the extent of your injuries, your prognosis, and the potential for future complications. Your attorney will help build your case off of this document and gather supporting evidence to strengthen your claim. This will likely involve contacting medical experts who can act as expert witnesses in your case.

An expert witness offers a unique and professional perspective on a legal case. Typically, a medical expert witness will explain a plaintiff’s injuries and damages in a way that the jury can easily understand. The medical expert will also likely cover potential future concerns for the plaintiff, such as necessary long-term medical care and disability.

An attorney can help secure testimony from an expert witness, and this can go a long way toward strengthening an insurance claim. Other forms of proof can include documentation from presiding physicians, photos of the claimant’s injuries and progression during treatment, and contributions from mental health experts for claims such as anxiety, depression, or Post-Traumatic Stress Disorder.

Methods for Calculating Pain and Suffering

Insurance companies generally use a multiplication or per diem rule for determining pain and suffering damages. With a multiplication method, the insurance company will typically multiply the claimant’s special damages by a certain amount to compensate the claimant for the physical pain and mental anguish associated with those damages. For example, if a claimant suffered $10,000 in medical expenses and another $10,000 in lost wages after an accident, the insurance company may multiply his or her special damages by three for a total of $60,000 in pain and suffering damages.

Under a per diem rule, the insurance company awards pain and suffering damages for each day the claimant experienced physical pain and psychological distress from an injury. The insurance company will typically select a per diem value based on the claimant’s injuries and then pay that amount for each day the claimant experienced pain and suffering until reaching maximum recovery.

Did the Insurance Company Make a Fair Offer?

If you receive a settlement offer from an insurance company, how do you know whether or not the offer is fair? You can test how reasonable an insurance company’s offer is by using the above listed methods to get a ballpark figure of what your claim is worth.

For example, if you incurred $10,000 in special damages for a severe injury that requires extensive recovery time and ongoing treatment, expecting $30,000 in pain and suffering damages wouldn’t be unreasonable. However, if your injury healed very quickly and has a minimal chance of causing permanent damage, this amount will likely be much lower.

Whenever there is any doubt concerning an insurance company’s settlement offer, your best course of action is to contact a reliable and experienced personal injury attorney. Your attorney will not only help you better understand the specifics of your claim, but can also help handle correspondence with insurance companies, arrange for expert witness testimony, and help you gather additional evidence to strengthen your claim and secure more compensation.

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