Available 24/7Car accident victims rightfully want to know how much they will receive in compensation. In addition, they want to know the basis for the amount. Knowing how a settlement is calculated is helpful for several reasons. It allows you to evaluate any settlement offers you receive. It helps you plan for the future and form realistic expectations.
How do you calculate a car accident settlement in California? Our California car accident lawyers explain.
Is There a Calculator for Car Accident Settlements in California?
Let’s start by clarifying one thing—there is no official car accident settlement calculator in California, and there is no such thing as an “average settlement.”
There are laws that state what a person is entitled to under the law. However, there is no calculator to neatly total up exactly how much someone will receive in compensation.
As you total up your damages, it’s important to remember that the entire case must be evaluated. You may calculate the sum of your damages allowable by law, evaluating your non-economic damages.
However, the total compensation you will likely receive may differ from this calculated amount. Some additional factors and considerations may impact the amount you receive.
What if the Insurance Company Talks About a Settlement Calculator?
If an insurance company references a calculator, it is just an estimator or software they use to arrive at a suggested amount to offer in settlement. It is not an official calculator.
With that said, a car accident victim can still total their damages. They can understand what losses are factored in and how to value them. Calculating the damages can give the person a starting point to evaluate the case and pursue settlement negotiations.
Formula for Calculating a Car Accident Settlement in California
To calculate a car accident settlement in California, use the following formula:
economic damages x non-economic multiplier – other factors = your car accident settlement
A car accident settlement begins with economic damages multiplied by a number representing the relative severity of the accident. Then, the total is raised or lowered to account for other factors that may influence the ultimate value of the case to arrive at an approximate settlement amount.
How to Calculate a Car Accident Settlement in California
To calculate a car accident settlement in California, follow these steps:
- Determine the Total of Your Economic Damages
Economic losses are direct financial losses the accident caused. Medical bills typically comprise a large portion of monetary damages in an accident claim. Bills for future medical treatments, property damage, and other tangible financial losses can be included. These amounts can be totaled and included in your settlement amount.
Sometimes, lost wages are included in economic damages before the multiplier is applied. It’s also common to separate lost wages and add them separately after applying the multiplier. Separating lost wages may justify using a higher multiplier so that you may arrive at a similar answer using either calculation method.
- Identify the Amount of Non-Economic Damages. Reduce It to a Multiplier
Once your tangible losses are accounted for, you must figure out compensation for your non-economic damages. Of course, you cannot add up the amount of your suffering like adding up a receipt. Instead, you apply a multiplier to the amount of non-economic damages.
For minor injuries where the recovery period is measured by weeks or months, the multiplier may be as low as 1.5. When a victim suffers life-changing injuries and severe, permanent debilitation that affects their enjoyment of life, a multiplier may be as high as 5.
There may be situations where your economic losses do not fairly reflect your non-economic losses. For example, you may have scars or physical disfigurement. These injuries may not benefit from expensive medical care. However, they may impact your life drastically. It’s essential to consider the relative impact on your life as you determine what multiplier to apply for your economic damages.
- Multiply Your Economic Damages by Your Non-Economic Multiplier
Once you know your multiplier, apply it to your economic damages. For example,
Economic damages = $100,000
Multiplier = 2.5
$100,000 x 2.5 = $250,000
Don’t add the economic damages amount; instead, take the total economic damages amount and multiply it by the multiplier figure to arrive at a subtotal.
- Add or Subtract Legal Factors That May Impact the Amount of the Claim
Simply totaling damages with a calculated formula often doesn’t give you an accurate amount for your settlement. Most settlements are different from this amount. Many other factors can impact what you receive in compensation, including:
- Comparative negligence and how shared fault may impact the claim
- What insurance policies exist to satisfy a judgment
- Who is responsible, including any employers or multiple responsible parties
- Any doubt about the legal fault of the defendant
- Questions about causation of injuries, including pre-existing conditions
- Applicability of any laws that may limit damages
- An award of punitive damages
If you have a very clear legal case, and if there is insurance or the party at fault has the resources to fully satisfy a judgment, you may receive most or all the calculated amount of your settlement. However, other factors may raise or lower the compensation you receive. If legal issues call the strength of the case into question, it may reduce the likely amount of compensation. If punitive damages are a possibility, they may raise the settlement amount.
Per Diem Calculation Method
A discussion of how car accident settlements are calculated would be incomplete without mentioning the per diem method. Rather than using a multiplier method, a daily value is calculated for the person’s non-economic damages.
This amount is awarded for each day the person is impacted by their injuries. This is another approach to determining a settlement amount for a car accident, but it may be impractical for long-term or debilitating injuries.
Ultimately, each car accident settlement is an individualized, personalized determination. No calculator can definitively determine the settlement amount completely and accurately in all cases.
It’s free to speak with us and learn the value of your case today.
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If You’re Overwhelmed by All This, Help Is Available
Calculating a car accident settlement in California on your own can be overwhelming and complex. The process involves navigating a web of legal terms, understanding insurance policies, and accurately assessing the full extent of your damages.
Attempting to handle this without professional help can lead to significant stress and potentially leave you with far less compensation than you deserve. Here’s why trying to calculate your settlement alone is challenging and why having a lawyer can make a significant difference.
The Complexity of Calculating a Settlement
A car accident settlement isn’t just about the immediate costs like vehicle repairs and medical bills. It must also take into account future expenses, lost wages, pain and suffering, emotional distress, and, in severe cases, long-term disability or diminished quality of life. These elements need to be quantified and backed by solid evidence, which is no easy task.
In California, the concept of “comparative negligence” further complicates matters. If you’re found partially at fault for the accident, your settlement could be reduced proportionally. Accurately determining your percentage of fault and how it impacts your compensation is challenging without a deep understanding of state laws.
Insurance Adjusters Are Not on Your Side
Insurance companies are businesses with a primary goal: to minimize payouts. They employ teams of adjusters and lawyers skilled in reducing the amount they pay on claims. If you try to negotiate a settlement on your own, you’re likely at a disadvantage because you lack the experience and knowledge they possess.
Adjusters might offer you a quick settlement that seems fair but is often far less than what you could receive with proper legal representation. Without a lawyer, you might accept a lowball offer simply because you don’t know how much your case is worth. Once you accept a settlement, you typically waive your right to pursue further compensation, even if you later discover additional injuries or damages. This can leave you struggling financially and emotionally long after you have spent the settlement check.
Benefits of Hiring a Lawyer to Calculate Your Car Accident Settlement
Hiring a lawyer to handle your car accident settlement brings numerous advantages. First and foremost, a lawyer can accurately assess the full scope of your damages, including those you might not have considered. They can help gather evidence, such as medical records, expert testimonies, and accident reconstruction reports, to build a strong case that maximizes your compensation.
A lawyer can also navigate the legal intricacies of your case, including the nuances of California’s comparative negligence laws. They can argue on your behalf to reduce any assigned fault percentage, thereby increasing your potential settlement.
Perhaps most importantly, a lawyer can take on the burden of dealing with the insurance company. They have the experience to negotiate aggressively, ensuring you’re not taken advantage of by adjusters who aim to undercut your settlement. In many cases, simply having a lawyer on your side can pressure the insurance company into offering a fair settlement sooner, avoiding a prolonged legal battle.
Don’t Accept a Settlement Without Legal Advice
The most crucial takeaway is to avoid accepting any settlement offer before speaking with a lawyer. What might seem like a generous offer at first glance could be far below what you deserve. A lawyer will ensure that all aspects of your case are considered and that you receive fair compensation that reflects the accident’s impact on your life.
Contact Sargent Law Firm for Help Calculating a Car Accident Settlement
Don’t wonder what your car accident settlement should be. Get a personalized consultation from a personal injury attorney at Sargent Law Firm. Contact our legal team today to discuss your case.
