How to Calculate Pain and Suffering Costs After an Injury

We walk you through two ways of calculating pain and suffering compensation. See settlement examples for different types of injury claims.

It’s easy to figure out how much money you need to cover medical costs after an accident – just add up all your bills and receipts.

But most of us pay a higher cost for injuries than just what medical bills show. These non-economic costs are known as pain and suffering.

You should know what counts as pain and suffering, and how to calculate what your pain and suffering damages are worth.

There are two basic methods for calculating pain and suffering compensation for an insurance claim: the per diem method and the multiplier method. We walk you through both methods and also explain how the insurance company might calculate the value of your personal injury claim.

The Per Diem Calculation Method

Per Diem is a Latin term for “by the day.” The per diem method of calculating pain and suffering assigns a dollar value for one day (often the amount of the person’s daily wages) then multiplies it by the number of days the injured person was affected by the injury.

Example: John’s Injury Compensation Using the Per Diem Method

John suffered a concussion and broken arm when he slipped and fell at his local grocery store. The store’s insurance company accepted full liability for the accident.

John had to endure headaches and a “fuzzy-headed” feeling for nearly three weeks. He was in a cast and sling for six weeks, which prevented him from working at his carpenter job where he earned $15 per hour.

John used his average daily wage as the per diem value for his compensation calculations.

Medical Expenses: $750

Lost Wages ($600 per week x 6 weeks): $3,600

Pain and Suffering ($120 per day for 6 weeks): $5,040

Total Compensation Demand ($750 + $3,600 + $5,040): $9,390

The per diem method does not take into consideration injury cause or the scope of an individual’s suffering. It’s also arguably unfair to individuals at the lower end of the wage spectrum.

Example: Comparison of Per Diem Results for Different Wage Earners 

Sally and Rhonda are back-seat passengers in a vehicle that is rear-ended by an SUV. Both women suffer whiplash neck injuries. Both women are out of work for a month before being released from a doctor’s care.

Sally makes $10 per hour at a fast-food restaurant. Sally’s per-diem is $80 x 30 days for a total of $2,400 for her pain and suffering.

Rhonda is an executive secretary earning $24 per hour. Her per diem is $192 x 30 days for a total of $5,760 for her pain and suffering.

The Multiplier Calculation Method

The Multiplier Method is the more common way to calculate pain and suffering for personal injury settlements. This calculation is made by totaling the injured party’s economic damages and applying a multiple from one to five.

Economic damages are your hard costs for medical bills, lost wages, and related out-of-pocket expenses. Insurance adjusters called these special damages.  You will have bills, receipts, and a letter verifying your lost income to support the dollar amounts figured into your economic damages.

The tricky part of using the multiplier method to value pain and suffering is figuring out which number to use as a multiple.

When you’ve fully recovered from relatively minor injuries and liability is uncontested, the at-fault party’s insurance company will usually accept a multiple of one or two times your economic damages to account for your pain and suffering.

Example: John’s Injury Compensation Using the Multiplier Method 

John suffered a concussion and broken arm when he slipped and fell at his local grocery store. The store’s insurance company accepted full liability for the accident.

John had to endure headaches and a “fuzzy-headed” feeling for nearly three weeks. He was in a cast and sling for six weeks, which prevented him from working at his carpenter job where he earned $15 per hour.

John calculated his injury claim value as follows:

Medical Expenses: $750

Lost Wages ($600 per week x 6 weeks): $3,600

Total Economic Damages ($750 + $3,600): $4,350

Pain and Suffering ($4,350 x 2): $8,700

Total Compensation Demand ($4,350 + $8,700): $13,050

Types of injuries that result in disfigurement, permanent injury or disability, a long and difficult recovery, and a loss of enjoyment in daily life will always have a higher pain and suffering value.

Severe injuries justify higher multipliers, but insurance companies won’t readily pay these higher settlements. You’ll need a personal injury attorney to convince the company to pay high amounts for non-economic damages. Most attorneys offer a free consultation to injury victims.

Example: Severe Injury Compensation Using the Multiplier Method 

Diane was driving home from work when her car was T-boned by a texting driver who ran a red light. She was cut out of the car and rushed to the hospital by ambulance.

Diane had emergency surgery at the hospital for a ruptured spleen. She was hospitalized for three weeks, during which time she had two more surgeries to repair broken bones in her hip and arm.  She was then transferred to a rehab center for two more weeks, followed by outpatient physical therapy.

Diane was out of work for six months. She gradually recovered from her injuries and returned to her job as an office manager, where she earned $17 per hour.

Medical Expenses: $21,000

Lost Wages ($680 per week x 24 weeks): $16,320

Total Economic Damages ($21,000 + $16,320): $27,320

Pain and Suffering ($27,320 x 4): $109,280

Total Compensation Demand ($27,320 + $109,280): $136,600

Diane’s personal injury lawyer made a demand to the insurance company for $138,000. The insurance adjuster understood that the lawyer wouldn’t hesitate to file a lawsuit on Diane’s behalf.

Because liability was clear and Diane’s injuries were well documented, her claim with the insurer was settled for $135,000.

How Insurance Companies Value Pain and Suffering

Attorneys and other professional negotiators understand that to reach a settlement both sides must compromise. When it comes to injury claims, the victim has to negotiate down from their initial compensation demand, but the insurance adjuster starts low and has to be convinced to pay more.

No matter what caused your injury, you will likely not get the full amount of your initial demand for pain and suffering. It’s just a starting point for negotiations.

Most insurance adjusters will accept financial losses like the cost of medical treatments, but will challenge the amount of compensation for pain and suffering.

Adjusters may refuse high pain and suffering demands when a claim involves:

  • Soft tissue injuries: Sprains, strains, and whiplash injuries are difficult to verify on an X-ray or CT scan, so adjusters are always skeptical of claims of pain or mental anguish.
  • Low-impact car accidents: Adjusters will argue that you could not have suffered much of an injury in a minor fender-bender.
  • Prior injuries: The adjuster will use prior injuries to argue that your pain and suffering was not caused by the current accident.
  • Low or no medical bills: Without physical injuries, you won’t get far with claims for pain and suffering. The adjuster won’t put a monetary value on emotional distress for your slip and fall when the only thing hurt was your pride.
  • Shared liability: Your overall settlement, including pain and suffering, can be reduced if the adjuster believes you share some of the blame for your injuries

Severe Injury Claims Often Require Litigation

While most injury claims are settled out of court, the most severe injury cases don’t get resolved before a lawsuit is filed. Even when there is no question of a catastrophic injury, the at-fault party’s insurer or law firm will dispute the amount of pain and suffering owed to the victim or close family members.

Some lawsuits settle before trial for undisclosed amounts. Personal injury cases that go to trial can have jury verdicts with significant pain and suffering awards.

Case Example: Jury Awards $15 Million for Pain and Suffering

Jerri Woodring-Thueson was an athletic 49-year-old when she was transferred to Harborview Medical Center’s Stroke Center for preventative care after a minor stroke.

Rather than get the state-of-the-art care she expected from Harborview, Jerri’s care was handed off to interns and residents. Her condition worsened until she was rushed into surgery.

Jerri made it through surgery but was left paralyzed on one side of her entire body. Her permanent injuries were devastating to Jerri and her husband.

At trial, Jerri’s attorney alleged that the negligence of Harborview and the doctors in charge of her care were the direct cause of her disabling paralysis.

The jury agreed and awarded $10.3 million to Jerri for past and future economic losses, $10 million for her non-economic damages, and $5 million for her husband’s pain and suffering, for a total of $25.3 million.

Calculating Pain and Suffering Questions

Charles R. Gueli, Esq. is a personal injury attorney with over 20 years of legal experience. He’s admitted to the NY State Bar, and been named a Super Lawyer for the NY Metro area, an exclusive honor awarded to the top five percent of attorneys. Charles has worked extensively in the areas of auto accidents,... Read More >>