Child Injury Claims & Settlements: What Every Parent Needs to Know

Personal injury claims involving children can be complicated. Here’s what parents must know to get fair compensation for their children.

While injuries to children are not uncommon, child injury claims include unique issues not found in adult claims.

For example, there’s a different timeline for filing claims, and there are limitations on who can file a claim on behalf of a child.

The settlement of a child injury claim adds another layer of complexity. There are special rules on how settlement funds get distributed and courts must often step in to approve settlement decisions.

Further, the mishandling of any settlement funds can be detrimental to the child’s financial future and can even lead to harmful legal consequences for the parent.

A child’s injuries can cause a great deal of anxiety for parents. This is true regarding both the child’s recovery and the parent doing what is legally necessary to receive compensation for a loved one.

Common Child Injury Claims

Child injury claims can arise from the same scenarios as with adult claims. For example, both children and adults can get injured in auto accidents. There are some scenarios, though, that are more unique with children.

Falls are one example. The Centers for Disease Control and Prevention (CDC) reports that U.S. emergency departments treat about 8,000 children for fall-related injuries every day.

Other examples include when children get injured by medical malpractice, dog bites, defective products (like toys or baby furniture), and sports activities.

Familiar places where children are injured include: 

Does Your Child Have a Valid Injury Claim?

Some childhood injuries are a natural part of growing up. For example, bumping a head at a playground or skinning a knee after falling.

These innocent types of injuries don’t form the basis for an injury claim.

Children have a claim if they suffered an injury from another person’s (or entity’s) negligence. In legal terms, negligence is conduct that falls short of what a reasonable person would do to protect another person from a foreseeable risk of harm.

In most negligence cases, a person has to prove the following:

  1. Duty of Care: The at-fault person or business had a duty of care to avoid harming a child. For example, a manufacturer has a duty to avoid making dangerous toys with lead paint or other hazards.
  2. Breach of Duty: The at-fault person breached their duty by doing something wrong or failing to do what any reasonable person would do in the same circumstances.
  3. Cause: The at-fault person’s breach of their duty of care was the proximate cause of your child’s injuries.
  4. Damages: Your child has verifiable injuries, supported by medical bills, medical records, and evidence of emotional distress.

If you can satisfy all of these elements, then there is a legitimate child injury claim. The at-fault party is considered responsible for your child’s accident and must compensate the child for any injuries caused.

If an injured person or their legal representative cannot prove each of the above elements, an injury claim will likely fail.

Example: Child Injured by Negligent Motorist

Jake, a 3rd-grade student, was walking home from school one afternoon. A car hit him after he entered a crosswalk. Doctors diagnosed him with three broken ribs and a ruptured spleen.

Here, Jake has a valid personal injury claim. The driver of the vehicle owed him a duty of care, that is, to stop at the crosswalk and to yield the right of way to any pedestrian. The driver failed to uphold this duty and instead hit Jake.

As a result of being hit, Jake sustained injuries that resulted in damages (e.g., medical bills and any pain and suffering experienced in his recovery)

The Statute of Limitations for Child Injuries

Every state has a statute of limitations for personal injury claims. A statute of limitations requires injured parties to file legal claims within a specific time period. If you don’t file your claim within that time frame, you’ll lose the right to seek compensation for your damages.

The statute of limitations in most states for personal injury cases is two or three years.

When the injured party is an adult, the statute of limitations begins running on the date of the injury. For children, however, the statute is “tolled.” Tolling means it doesn’t start to run until their 18th birthday, no matter how old they were when the injury occurred.

For example, if the statute of limitations in your state is three years, a child who suffers a personal injury when they are 12 years old would have until three years after their 18th birthday to file an injury claim. If they didn’t file their injury claim by their 21st birthday, they’d no longer have the option to do so.

Waiting until the victim reaches 18 years of age to file a lawsuit can be risky in some situations. Valuable evidence such as witness testimony and medical records could get lost or destroyed. For such reasons, many parents and legal guardians should pursue a legal claim on their child’s behalf long before they turn 18.

If the parents choose to file and settle a lawsuit while the child is still a minor, the child can’t file one for the same claim after they reach adulthood.

Who Can File an Injury Claim for a Child?

Injured children cannot file or settle their own injury claims. This rule means another party has to represent them.

This other party is a qualified adult known as a “next friend.” A next friend is an adult who represents a minor child or someone who is not legally competent to represent themselves in court.

Next friends are usually:

  • One parent
  • Both parents
  • A legal guardian
  • A court-appointed attorney

However, just because your child has an injury claim doesn’t mean that you automatically assume the role of their next friend. Depending on your local laws, you may need court approval to serve as this representative.

You should also be aware that some courts will appoint a Guardian Ad Litem (GAL) to represent a child’s best interests in court. A GAL doesn’t replace a parent, next friend, or attorney but rather appears independently to represent the child.

The GAL works for the court and not the parent or their attorney.

Damages in Child Injury Cases

Most child injury cases involve damages for both the injured child and the child’s parent(s).

Parents or legal guardians have a right to seek compensation for medical bills paid on behalf of their child. In addition to medical expenses, parents can pursue damages for their own emotional distress, and for the impact on the relationship with their child.

Parents usually include their damage claims in the child’s lawsuit, but they may be able to file a separate legal action instead.

A child’s injuries generally include certain non-economic damages like: 

  • Loss of enjoyment of life
  • Humiliation
  • Emotional anguish
  • Scarring or disfigurement
  • Loss of function of a body part

The value of non-economic damages is not concrete. During settlement negotiations, the injured child’s representative must calculate what the child’s damages are worth. If the case goes to trial, a jury will decide this for the child and their parents.

The loss of future income can also be included in a child’s injury claim if the injuries will have an impact on the child’s ability to earn a living as an adult.

For example, Tiffany, age 15, was hit by a drunk driver and life-flighted to the hospital for severe injuries. These included a broken neck and severe traumatic brain injury. Tiffany will require special care for the rest of her life, which impacts her future earning capacity. Her parents or next friend can file an injury claim seeking compensation for her medical bills, her loss of future earning capacity, and her current and future pain and suffering.

When Child Injuries Cause Fatalities

If a child dies from their injuries, the parents can file a wrongful death lawsuit without the need of a next friend or GAL. Their damages will be similar to a child injury claim but can also include funeral and burial expenses.

The statute of limitations for wrongful death lawsuits is sometimes different than child personal injury lawsuits. Depending on state laws, parents may only have a couple of years from the date of their child’s death to file a claim.

Compensation for Child Injury Claims

Like injury claims involving adults, child injury claims can end in a settlement negotiated with the insurance company or through a court. A settlement agreement will include many provisions, which are the specific items that the settling parties agree on.

A necessary provision in child injury cases relates to the distribution of the money and its use. For example, provisions will state if the settlement will reimburse the child’s parents for their medical expenses.

As to the distribution of money, some states require a court to approve a settlement before a child can receive any compensation.

For example, Indiana Code § 29-3-9-7 requires that parents or guardians petition the court for approval to settle the claim for the specified amount. In some states, all settlements over $5,000-$10,000 must have court approval.

Under California Probate Code § 3611(d)94 and 340195, the court requires approval for payments over $5,000.

Court approval ensures that settlement agreements are enforceable and that the injured victim will not sue when they reach the age of 18. It also ensures that the child’s best interests are fully protected.

To obtain approval from the court, you or your attorney will need to file legal documents. Some states require the adults representing the child and the attorneys for the insurance company to appear at a hearing. During this hearing, the judge will ask them to explain why the settlement amount is fair to the child.

The judge might ask about the child’s:

Once the judge approves the amount, the child’s next friend will need to approve it by signing it. The child is then bound by the court-approved settlement. Even when they turn 18, they cannot decide to file another lawsuit if they think their compensation was unfair.

Managing a Child’s Compensation

When it comes to managing settlements for children, the court’s role is to protect the best interest of the child.

The court recognizes that even well-intended parents and guardians can make financial mistakes. To help prevent these mistakes, courts impose strict guidelines regarding how the funds from a minor’s settlement can be managed and used.

Determining how your child should receive their settlement is best done before the settlement offer goes to the judge for approval. Some options will not be available to you after the settlement is finalized, so exercise your rights at this point.

State-specific laws and the amount of your child’s settlement might limit your options. A personal injury attorney can explain what options are available in your child’s case. 

There are generally three legal options for managing the proceeds of your child’s settlement.

Structured Settlements

The first option is to set up a structured settlement. A structured settlement is an arrangement for receiving settlement funds over a predetermined time frame. This is as opposed to receiving money in one lump sum. These settlements get funded by several payments staggered in equal intervals.

Children can begin collecting money in these settlements when they reach the age of majority in your state of residence. The benefits of a structured settlement are that there are no ongoing fees that get paid. Also, the settlement money, as well as any growth it incurs, are income-tax-free.

Trust Account

A trust account is a type of financial account that is opened by one person but managed by a designated trustee for the benefit of another party.

The injured child’s parents or next-friend usually open these accounts, and the trustee manages the funds for the benefit of the child.

The trustee must manage the account under the agreed-upon terms of the settlement. Further, the trustee must only distribute funds for the benefit of the child and must follow all requirements of the trust.

A trustee who wrongfully accesses or uses the funds in a trust can face penalties.

Laws around trust accounts for minors can vary by state, so you might want to check with a financial planner or an attorney before choosing this option. Generally, the court can delay the distribution of the funds until after your child reaches the age of majority.

Trusts can be beneficial because they grow money securely, promote proper use of it, and help avoid costly mistakes. Drawbacks to using a trust are that there are usually fees for drafting the trust and paying a trustee, and interest incurred on the account is taxable.

In some situations, there may be options for early withdrawal of funds when it directly benefits the child and is related to the injury.

Depending on the applicable state law, the at-fault party may be ordered to pay the administrative fees for setting up a trust account for the benefit of a child.

Guardianship Account

Every state allows the option of a simple guardianship account, also known as a blocked account. A person (most often a parent) can start this account with most banks and manage the funds for the child.

Before opening an account, you’ll need a court order and must present it to the bank. The order contains the court’s specific instructions concerning the management of the account and its funds. The court issuing the order will periodically monitor your account management to make sure you’re following all applicable instructions.

Guardianship accounts are safe ways to invest, but they only draw a small amount of interest. Further, any interest accrued is subject to taxes. Once the minor reaches the age of majority, they receive full access to the funds.

If your child’s claim is worth more than $10,000, under the Uniform Transfers to Minors Act (UTMA) most states require court approval for any planned or unplanned disbursements.

You should also be aware that:

  • Your child’s eligibility for government support services such as Medicaid, CHIPS, SSA, and others can be impacted by how much they receive for their claim and how you manage the funds.
  • A Special Needs Trust can sometimes be used to allow your child to continue receiving government services after receiving an injury settlement.
  • If you do not file a lawsuit on your child’s behalf, but they file one after they turn 18, any settlement they receive won’t require court-approval or come with rules about its distribution.

Protect Your Child by Hiring a Personal Injury Attorney

Due to the complexity of child injury payouts, consulting with an experienced injury attorney is in your best interest. Both legal and financial implications can have a long-lasting impact on you and your child’s future.

If your child is injured, it is imperative that you receive reliable legal advice. You want to maximize your child’s compensation and be sure that any funds they receive are for their benefit. By hiring an injury attorney, you can accomplish both of these tasks.

Most attorneys handle injury claims on a contingency fee basis, and offer a free initial consultation. It costs nothing to get the legal advice you need to help your child receive the compensation they deserve.

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Dustin Reichard, Esq. is an experienced attorney with 20 years of work in the legal field. He’s admitted to the Illinois State Bar and the Washington State Bar. Dustin has worked in the areas of medical malpractice, wrongful death, product liability, slip and falls, and general liability. Dustin began his legal career as a JAG... Read More >>