How Is a Settlement Calculated in a Car Accident Case?

How Is a Settlement Calculated in a Car Accident Case?

• August 23
• Evans/Reilley
• Car Accidents

On average, car accident victims in the U.S. who file a lawsuit receive $19,000. However, the average settlement amount doesn’t tell you much about what you can expect to receive for your case or situation. The “typical” amount can’t be used to indicate the compensation you will receive for your case or situation.

If you are in a situation where you are filing a personal injury lawsuit after a car accident, you likely have a few questions. Some of the most common include:

• How is a settlement calculated in a car accident case?
• How to determine compensation in a car accident case?
• How is insurance compensation calculated after a car accident?

If you have questions like these, keep reading. Here you can learn more about the process used to determine what your car accident claim is worth.

Information Required to Make a Compensation Estimate

In most cases, the compensation you can receive after an injury caused in a car accident will be equivalent to the cost of your damages and injuries.

Vehicle Damage Estimates

Some of the things that are considered when determining the damages you should receive for harm done to your vehicle include:

• Initial value of your vehicle
• Condition of the vehicle when the accident occurred
• Depreciation of the vehicle
• Mileage on the vehicle.

Also, when considering repair amounts, it’s necessary to consider the cost of the parts that must be replaced instead of providing a general amount to repair something (like damage to the hood and the front end of the vehicle).

Injuries Caused by the Accident

Determining a value for the injuries you sustained in a car accident is more challenging than determining the cost of car repairs. After all, there’s no market price for an injury or body part. Also, an injury’s effects vary from person to person.

For example, if a young female athlete is in an accident that results in the loss of her limb, it would have more of an emotional and financial impact on her than it would on an elderly woman who can no longer work. For the athlete, her ability to work and earn money would be significantly reduced because of the accident, which would likely change her life significantly. While the accident is still devastating for the elderly victim, it does not have the same impact on her financial situation or her ability to engage in “normal” life.

Your personal injury lawyer will gather the information related to your damages and injuries to evaluate the value of your claim.

What Insurance Adjusters Use to Determine Your Claim’s Value

After an accident, the insurance company for the liable party must pay some of the following costs:

• Medical costs related to the accident
• Lost wages related to missing work and other types of lost income
• Physical suffering and pain
• Permanent physical disfigurement or disability
• Emotional damages caused by the above costs.

For a car accident where compensation for pain and suffering is not being requested, it is usually just the process of adding up the repair and medical costs. However, for cases involving pain and suffering and replacing a vehicle, most insurance companies provide more compensation with the determined amount to cover your lost wages, vehicle replacement or repairs, and medical costs.

The insurance companies will use different methods to determine the value of your personal injury claim. Some are different multiplier methods. However, unlike lawyers, an insurance company will probably not use whole numbers of a multiplier; instead, they will use more complex algorithms to figure out what multiplier to use. An insurance company’s equation to determine pain and suffering compensation is often referred to as the damage formula.

Damage Formula

When your claim is being negotiated, the insurance adjuster for the at-fault party will figure out all related medical costs that were caused by your accident. These are called special damages or medical special damages.

When determining the amount of compensation owed for permanent disabilities, emotional damages, and pain and suffering, the insurance adjuster will multiply the total amount of the special damages by about one and a half to three if the injuries you experienced were relatively minor.

If the injuries are more painful and severe, then the adjuster will multiply by five or more and include lost income. Usually, for settlements, the total that is determined from this calculation is the starting point of accident compensation negotiations.

After the starting point is known, more facts related to the accident and the injuries it caused will be revealed, impacting the settlement amount.

Lawyer Fee Considerations

To understand the full value of your claim and what you will receive when your case is decided on, you also must consider the fees that go along with your case.

The amount of money that your attorney will take from your settlement is something you determine with the person you hire when you sign the contract. The good news is that calculating lawyer fees is relatively easy. They will be outlined in your contract or agreement.

While the fees can vary from one attorney to another, they usually range from 30% to 40%.

Hire an Experienced Personal Injury Lawyer for Help with Your Car Accident Claim

If you are involved in a car accident that was caused by someone else’s negligence, one of the best things you can do is to get in touch with a Austin personal injury attorney. The attorney you hire will help ensure that you get quality representation for your case and recover the compensation you deserve for your damages and injuries.

At Evans/Reilley, our car accident lawyers are ready to help with your case and ensure you get the compensation you deserve for your injuries and damages. The first step is to reach out to our legal team by contacting us at (512) 732-2727. Call today to learn more about our services and how we can help with your personal injury claim.