How Do Insurance Companies Determine Pain and Suffering?

Anytime someone is injured because of the negligent or careless actions of a business or an individual, that victim could be eligible for compensation. Many people know that an injury victim is entitled to costs for things, such as medical expenses, typical out-of-pocket bills associated with treating the injury, and lost income, but victims are also eligible to get compensation for different kinds of pain and suffering damages.

The mental anguish associated with some accident injuries can be serious, especially if you experience a loss of enjoyment of life because of the things you're no longer able to do. Fighting for a fair settlement is extremely important, whether you're dealing with a medical malpractice claim or accident injuries from a car crash. Injured parties have the right to pursue settlement negotiations or lawsuits against an at-fault party. 

Insurance carriers can be extremely hard to interact within these circumstances, making it all the more important to retain dedicated lawyers like those working at Morgan & Morgan. Recognizing the possibility of pain and suffering damages can also help you more carefully evaluate the settlement offer if one is received. Settlement offers are the most common way that personal injury claims are settled for non-economic damages. 

When an insurance company comes to the negotiation table with a recommendation of how the case is closed out, this is known as a settlement offer. This settlement offer may not fully compensate you for these expenses you have already sustained, and it may not compensate you for pain and suffering or future expenses. Having the right attorneys at your side can make it much easier to respond to the possibility of resolving things in a settlement so that you feel more confident about protecting your legal rights. Because it is not always easy to navigate this process alone and figure out how insurance companies calculate pain and suffering, you need a lawyer who has been down this road before with past victims.

Unlike property damages or broken bones, special damages require a level of interpretation about how something like a person's enjoyment of life has been impacted. 

Following a vehicle crash or other injury related to negligence, a person can sustain a few different kinds of losses. These are known as economic and non-economic losses. Non-economic losses are typically harder to quantify than other kinds of losses such as lost income and medical bills. This is because pain and suffering can be hard to put an estimate on as it relates to psychological and emotional trauma that someone goes through, including anxiety, worry, grief, anger, or possibly PTSD. 

Bear in mind that even though you may have been a paying customer of an insurance company for years, they are not always there to represent your best interests. It is certainly true that they are not there to represent your best interests when the insurance company you're filing a claim with belongs to the party who caused the accident. Understanding the ways in which insurance companies think can greatly increase your chances of success in these kinds of lawsuits. 

Once you recognize that an insurance adjuster's primary purpose is to minimize the benefits they pay out in a lawsuit, this can often influence your pain and suffering settlement and can help you understand when or when not to accept a settlement amount. One way that insurance companies can reduce the amount of money they pay in a settlement is by minimizing the compensation for someone's pain and suffering. They are able to do this because there is no one clear rule or law about the way in which insurance companies must total pain and suffering damages.

If your accident claim includes pain and suffering amounts, talk about this and other financial losses with your lawyer. 

While there are no hard and fast rules about how insurance companies pay for pain and suffering damages, there are two common approaches to calculating this amount. The first is to add up all of the economic expenses including out-of-pocket costs, medical bills, and lost wages, and then multiply this amount by a total set number. That number is usually between 1.5 and 5 associated with the severity of the accident. This multiplier method is used for reaching total pain and suffering damages. People with attorneys often work directly with their lawyer to determine the best course of action in their case when it comes to damage amounts. 

Another method to use in these circumstances is also known as the per day or per diem approach. A specific dollar amount is given each day from the date that the accident happened until when the plaintiff achieves maximum medical recovery. Note that reaching maximum medical recovery does not mean that you have fully recovered and healed from the accident. In fact, many people will continue to have devastating injuries and problematic pain for years following their incident. This means that reaching maximum medical recovery is simply the point at which your doctor does not think you will progress any further in your healing. Once you achieve this amount, this could be factored into the alternative calculation method. 

If $100 was given as a per diem amount, for example, and it took a total of 300 days for an injury victim to get better, the pain and suffering damages come to $30,000. When trying to figure out how insurance companies calculate pain and suffering, you must also recognize that you may not be privy to the details they use to calculate these totals. Insurance companies use complicated computer systems to determine the amount they will offer someone for pain and suffering. 

These programs are not visible to you, nor will they likely share the outcomes with you. However, they can evaluate the kind of medical treatments the person got, and the kind of injuries sustained. No matter how you find yourself in this situation, you need to have competent and knowledgeable legal representation to protect your best interests. 

Although you cannot ever fully know how insurance companies total pain and suffering amounts, a lawyer who has been down this road before and who has advocated for other victims will be very familiar with the most common types of strategies and will be able to help and assist you during this process. You deserve to have an attorney who will take your case seriously and who will do everything possible to protect your rights. The insurance carrier is not interested in doing what is best for you, but rather what is best for them.

One of the most common questions asked after how insurance companies calculate pain and suffering, is how to know when it's a reasonable offer. A fair approach is to use either the per diem method or the multiplier method mentioned above to get a ballpark idea. You also might have to add extenuating circumstances to this calculation. This includes whether or not there were additional impacts that could increase or decrease that amount. 

If you were left with a scar that you will have to see for the rest of your life as a result of the accident, for example, you may increase the amount determined in the per diem or the multiplier method. Ultimately your lawyer will talk with you about whether or not something has reached a fair amount. Being able to sign a settlement agreement could allow you to close out this matter and go back to living your life, but it is also important to verify that you have received the necessary benefits you deserve. 

If you believe that you may be taken advantage of by the insurance company or have other questions about the legal process, you need to have an experienced and dedicated lawyer guide you through the process to answer your question so that you know what to expect. You should never have to be alone when pursuing compensation for pain and suffering or other expenses associated with an accident.

The sooner you speak to a personal injury attorney the better. The support of a lawyer is instrumental in outlining some of the most important legal facets of the case and could make a big impact on your ability to recover compensation.

If you've already been hurt, it's in your best interests to set aside time to meet with an experienced attorney right away. You are not required to hire a lawyer at that point, but it is recommended that you work with someone as soon as possible to understand the full scope of your case for civil lawsuits.