The Different Methods to Calculate Non-Economic Losses in a Car Accident Case

Car accidents have taken many lives in the US. Drivers tend to breach the duty of care they owe to other drivers, which is the primary reason for car accidents. Accidents will not happen if people just uphold the duty of care they owe to others.

The following are some of the most common causes of car accidents:

  • Distracted driving
  • Fatigue
  • Drunk driving
  • Speeding
  • Violating traffic laws

Filing a car accident claim is the best thing you can do following an accident. A car accident attorney can help you with the claim and obtain fair compensation for you.

To win a personal injury claim, you need to prove the four elements of personal injury law, which are:

  • Duty of care
  • Breach of duty of care
  • Causation 
  • Damages

If you manage to prove the above, you can claim compensation for two types of losses:

Other than these two types, you can claim punitive damages in some cases. 

Economic damages are pretty straightforward and easy to calculate. The same can’t be said for non-economic losses.

Calculating non-economic losses is quite hard, as the losses are personal to the victim.

Understanding Non-Economic Losses

Non-economic losses are the emotional losses a victim will sustain due to an accident. Non-economic losses factor in losses like pain and suffering a victim suffers as a result of their injuries. The following are some of the non-economic losses that victims suffer:

  • Pain and suffering
  • Loss of consortium
  • Loss of quality of life
  • Reputational loss
  • Loss of enjoyment of life
  • Emotional distress

How to Calculate Non-Economic Losses

You cannot put a definitive value on non-economic losses. So lawyers use two methods to calculate non-economic losses, which are:

  • Multiplier method
  • Per-diem method

Multiplier Method

In this method, you will be allotted a value between 1.5 and 5. Your total damages will be multiplied by this allotted value. 

For example, your total economic loss is $15,000. You have been assigned 3 as your multiplier. Your non-economic loss will be $45,000.

The multiplier will be determined based on the severity of your losses.

Per-Diem Method

The per-diem is another common method that many lawyers use. In this method, your days will be assigned a dollar value. This value will be your daily wage in most cases. 

For instance, your daily wage is $100, and you get it as your per-day rate. You will receive this money until you fully recover. If it takes 50 days for you to recover fully, then you will receive $5000 as your non-economic compensation.

Why Should You Hire a Lawyer?

As you know, insurance adjusters will reach out to the victim, analyze the losses, and offer fair compensation for the victim’s losses.

If that’s the case, there is no reason to hire a lawyer, right?

Well, that is just the insurance companies’ claims. The reality is far different from what they claim.

Yes, the insurance adjusters will reach out to the victim, but the offer they make will be nowhere near fair. 

When they analyze your claim, they will try their best to reduce your compensation as much as possible. 

A lawyer can prevent this from happening. The most important benefit of hiring an attorney is that they can protect you from insurance companies.

Personal injury lawyers will calculate your economic and non-economic losses and get them as compensation. They will not settle for less.

Final Thoughts

Non-economic losses can give a significant boost to your total compensation. Sometimes, the non-economic losses will be more severe than the economic losses. Do not let insurance adjusters analyze your claims. Hire a lawyer and let them analyze your claim. They will calculate your losses accurately and obtain fair compensation.


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