Personal Injury Compensation Guide: Get More for Your Claim

How to value a claim and maximize your personal injury compensation. Learn about types of damages, factors that can impact your payout, and more.

Personal injury compensation is money paid to an injured party for damages caused by someone else’s negligence.

Typically, the at-fault party’s insurance company pays the injured person a negotiated settlement amount.

This personal injury compensation guide covers types of damages, how to value your losses, who pays your compensation, average payouts, when and how to file a personal injury claim, and what to expect from the claim process.

You’ll also learn how factors like shared fault and medical liens impact the amount of settlement money you get to keep.

Types of Personal Injury Damages

There are two main types of damages in a personal injury claim:

  1. Economic damages, also called hard costs or “special damages,” are measurable expenses that are verified by bills, receipts, and other documentation.
  2. Non-economic damages, also called pain and suffering or “general damages,” are not objectively measurable and therefore harder to justify.

Types of economic damages include:

  • Medical expenses
  • Out-of-pocket expenses
  • Replacement services
  • Transportation costs
  • Property damage
  • Lost income

Medical treatment expenses: The cost of treating your injuries is a major factor in the total value of your claim. Gather all bills related to your medical care, including invoices from ambulance services, medical facilities, physicians, physical therapists, and medications.

Don’t overlook related bills. If you have an X-ray or CT scan, there will be a bill from the imaging facility and another bill from the radiologist who interprets the results.

Use the full value of each expense for your settlement calculations, even if most or all of the bills were covered by Medicare, Medicaid, the VA, or private healthcare coverage.

Out-of-pocket expenses: These include the amounts you spend on things like over-the-counter medications, bandages, crutches, special dietary aids, or anything else that’s related to your injury, but not billed as part of your medical treatment.

Replacement services: This represents the cost of services you’d have done yourself if you weren’t injured. These include tasks around the home, such as lawn care, housekeeping, childcare, snow removal, and more.

Transportation costs: You can request reimbursement for mileage and parking when traveling back and forth to medical appointments, or the cost of taxi rides.

Property damage: Most car accident claims include compensation for vehicle damage. But a variety of personal property is damaged in accidents. This includes property like clothing, eyeglasses, cell phones, laptops, watches, and even pets.

Lost income: You are entitled to compensation for lost wages, even if the days off work are covered by vacation or sick leave. The insurance company won’t argue about lost wages that are excused by a doctor’s note and make sense in the context of your injuries and occupation.

Ask your employer for a written statement of lost wages. If you are self-employed, you can use profit and loss statements, copies of communications with clients reflecting your reduced earning capacity, and documentation showing your typical income prior to the accident.

Types of non-economic damages include:

  • Physical pain
  • Emotional distress
  • Loss of consortium
  • Loss of enjoyment of life

Physical pain: This is the physical distress a person experiences at the time of their injury and the ongoing pain throughout their recovery. Physical pain includes soreness, stiffness, headaches, nausea and vomiting, dizziness, fatigue, itching and chafing, weakness, and more.

For permanent injuries, including scarring, disfigurement, and disability, physical pain and loss of function can last the remainder of the injured victim’s life.

Emotional distress: Experiencing a violent and painful injury is a shock to the mind as well as the body. Types of emotional distress from a sudden injury can include fear, anxiety, depression, anger, nightmares, and more. Some accident victims are diagnosed with post-traumatic stress disorder (PTSD) after an accident.

Loss of consortium: This is a blanket term for the loss of love and intimacy that occurs when someone is injured. It’s not limited to the loss of sexual relations with a spouse, as commonly thought. It represents the loss of companionship and care in all familial relationships.

Loss of enjoyment of life: This happens when the injured victim can no longer participate and enjoy activities that were an important part of their life before the injury. These activities can include recreational pursuits, hobbies, daily exercise, social activities with friends, faith-based activities, and more.

In a minor injury claim, it’s reasonable to ask for one or two times the amount of your hard costs to account for your pain and suffering, but you have to convince the adjuster to pay. Insurance adjusters are usually willing to pay a few hundred dollars for your “inconvenience” and act like they are doing you a favor. To get more than that for a minor injury claim, you justify your demand.

Keeping an injury diary is an excellent way to track the physical pain and mental anguish you endured from the accident and throughout your recovery. Use descriptive language to explain your agonizing pain, cold sweats and night terrors, heartbreak and sadness, loss of companionship, and so on.

You can also research typical pain and related emotional hardship suffered by others in similar situations, and get a narrative from your doctor describing the physical basis for your pain.

How Much is Your Personal Injury Claim Worth?

Compensation is based on the type of injury and the total amount of your damages. This includes medical bills, lost wages, out-of-pocket expenses, and pain and suffering. Without some type of physical injury, it will be difficult to justify your claim.

  1. Minor Injuries: For mild-to-moderate injuries, you can estimate your claim value by adding up all your hard costs, like medical bills and lost wages, then adding one to two times that amount for your pain and suffering. You will need proof of all your damages to maximize your settlement.
  2. Serious Injuries: For serious injuries, compensation must be calculated by an experienced personal injury attorney. The claim value of permanent impairment should include the cost of future medical care and a larger amount for pain and suffering. There’s too much at stake in serious injury or wrongful death claims to pursue compensation without an attorney.

Personal injuries can result from car accidents, slip and falls, dog bites, medical malpractice, defective products, and more. Find out how much your claim is worth with this personal injury payout guide.

Average Personal Injury Settlement Amounts

Most personal injury claims settle out of court in a range from $5,000 to $75,000. The average auto insurance bodily injury claim settles for around $15,500.

Notably, personal injury cases that end up in court don’t always result in huge payouts. Half of all jury awards in tort cases were $30,000 or less, while 75 percent came in under $152,000.

See average personal injury settlement amounts for different injuries.

5 Steps to Getting a Personal Injury Settlement

Personal injury claims typically settle out of court, following the same basic steps:

  1. Give notification: As soon as possible after the accident, provide the at-fault party or their insurance company notice of your intent to seek compensation for your injuries.
  2. Gather evidence: Collecting evidence begins at the scene of your injury and continues throughout your treatment and recovery.
  3. Demand compensation: After calculating the value of your claim, a settlement demand letter and supporting documents are sent to the insurance company.
  4. Negotiate a settlement: After the adjuster responds to the demand for compensation, you or your attorney will engage in a few rounds of settlement negotiations.
  5. Sign the release: The agreed-upon terms are stated in a written settlement and release agreement. After signing the agreement, a check is mailed to the claimant or their attorney.

Whether you’re in a car accident, slip and fall, or injured by a dangerous product, your injury settlement will almost always be paid by the at-fault party’s auto or property insurance company. Occasionally, it may make sense for an injured victim to sue the at-fault party directly for compensation.

File a personal injury insurance claim as soon as possible after the event that caused your injuries. You don’t have to be ready to negotiate when you file your claim. Negotiations can wait until after you’ve treated and recovered from your injuries.

Once you’ve filed a claim for compensation, the insurance company will give you a claim number and assign your claim to an adjuster. In auto accidents, your vehicle damage and injury claims might be handled separately, with different claim numbers and adjusters.

Don’t be surprised if the adjuster reaches out with a fast settlement offer. Adjusters are rewarded for settling injury claims quickly, for as little money as possible. You’re better off waiting until you fully recover from your injuries before discussing a settlement.

Take your time to recover. If you decide to handle your own claim, use the time to collect evidence and prepare for settlement negotiations.

You may be asked to provide a recorded statement. Most personal injury lawyers advise against giving a recorded statement without legal advice. Adjusters are trained to trick you into saying things that can hurt your claim. Never agree to a recorded statement when you are tired, upset, medicated, or in pain.

Every state has a statute of limitations for settling an injury claim. If you haven’t settled your claim or filed a personal injury lawsuit before the statute expires, you forfeit your right to compensation. The insurance company doesn’t always have to tell you when time is running out.

Other Factors That Can Affect Personal Injury Awards

Every personal injury case is different, involving multiple factors that impact bodily injury claims and settlements. These factors can include:

  • Shared Fault: Most states have comparative fault laws. The adjuster may try to use shared fault as an excuse to reduce or deny your compensation.
  • Insurance Policy Limits: The at-fault party may not have enough insurance to pay for all your damages. Or, if multiple accident victims are injured, there may not be enough bodily injury coverage to go around.
  • Lack of Evidence: Without strong evidence of the other party’s fault, or proof of your injuries, the insurance company may only offer a “nuisance value” settlement.
  • Punitive Damages: Punitive damages are high-dollar court awards, in addition to compensatory damages, given when the at-fault party’s actions are particularly reprehensible.
  • Wrongful Death: If the injured party is deceased, their family members will file a wrongful death case against the responsible party. These are very high-value, complicated cases, and must be handled by an experienced attorney.
  • Medical Liens: Common liens that must be paid from your settlement proceeds include medical liens from doctors or hospitals; insurance liens from Medicare, Medicaid, the VA, private health care insurers, or workers’ compensation; and past-due child support.

Personal Injury Compensation Questions