Estimating What a Car Crash Injury Claim May be Worth
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September 25, 2020
One of the most important questions about a car crash claim is: what is it worth?
Insurance companies and personal injury attorneys have different methods for calculating a claim’s value. There are pros and cons to each. Learn more about both and the information lawyers and insurance companies need to make these calculations.
What Your Lawyer Needs to Know
Your lawyer needs to determine the full cost of treating your injuries and repairing the damage to your car. There are many factors that must be considered, such as the market value of your vehicle, the condition of the vehicle when the accident happened, mileage and how much the vehicle has depreciated in value. Attorneys may also look at the cost of specific parts that must be replaced.
Determining the cost of a vehicle or repairs is generally more straightforward than calculating the cost of treating injuries. One reason why is injuries affect each person differently ”“ an old man is more likely to suffer complications and other setbacks compared to a young person who is an athlete. The financial impact of an injury on an older retired person may be less severe compared to a younger person who needs to work for several decades.
The Phoenix personal injury lawyers at Phillips Law Group carefully investigate these situations to gather the relevant evidence and accurately estimate a claim’s value.
Ways Insurance Adjusters Determine an Injury Claim’s Value
When a car crash occurs, the at-fault driver’s insurance company is likely to be pursued for damages, such as:
- Medical bills and other costs of treating your injuries
- Lost wages
- Pain and suffering
- Permanent disability
- Permanent disfigurement
- Emotional suffering
Two of the most common methods insurance companies and lawyers use to calculate an injury claim’s value include the multiplier method and per diem method. Insurance companies are likely to use complex computer algorithms to determine a multiplier, as opposed to lawyers who often use whole numbers.
Multiplier Method for Valuing a Claim
Put simply, the multiplier method takes the total value of special damages and multiplies it by a number to determine what pain and suffering should be worth. Special damages are the economic losses victims suffer, such as medical expenses and lost wages.
If you have $10,000 in hospital bills and lost $1,000 in wages, and your lawyer decided to use the multiplier method, he or she would multiply $11,000 by a number between one and five. Three is the number often used as a multiplier. In this example, the victim’s pain and suffering would be valued at $33,000.
The worse a victim’s injuries are, the higher the multiplier is likely to be. If you were injured in a minor accident and your injuries are expected to heal completely, the multiplier may be just one or two.
In rare circumstances, the multiplier may be greater than five, such as in a drunk driving crash.
Insurance companies generally use a multiplier between one and three for minor injuries and a multiplier of five or more for severe injuries. The number the adjuster arrives at after using the multiplier method is often a starting point for negotiations. As the investigation unfolds, more information may come to light that causes the adjuster to change the offer to include compensation for pain and suffering and other similar damages.
Cons of the Multiplier Method
One problem with the multiplier method is it is inconsistent. Different attorneys use different numbers, and there is no agreed upon standard. One attorney may use a multiplier of five for a significant spinal cord injury while another may use a multiplier of three for a very similar injury.
Another criticism of the multiplier method is it only looks at medical bills and fails to account for the victim’s circumstances.
One injury victim’s medical bills may not be as expensive as someone else’s, but the victim who owes less in medical bills may have more significant pain and suffering.
For example, a professional musician with a wrist injury may experience greater psychological suffering because it may impact his or her ability to perform as a musician. Someone who has a similar injury but works in an office may not deal with anywhere near the same level of pain and suffering.
Per Diem Method
Another way to calculate the value of pain and suffering is to determine the daily value of these damages. For example, an attorney may say a victim should receive $15 per day as compensation for pain and suffering.
Car Accident Settlement Calculators: Are They Accurate?
There is no perfectly precise method for calculating what pain and suffering may be worth. Each method has its flaws and shortcomings. Evaluating pain and suffering for a claim requires more information than can be collected in an online car accident settlement calculator. That is why injury victims should not rely on them for a completely accurate valuation of their claim.
However, while the figures provided by an online calculator may not be entirely accurate, it may provide you with a general idea when considering the full value of your claim.
Call to Discuss Your Claim with a Licensed Attorney
Injury victims may be tempted to try to pursue compensation on their own. Often people may think they cannot afford to hire an attorney, or they may not know the many benefits of working with an experienced lawyer.
However, the truth is that those who hire an attorney often receive more compensation than those who do not. The experienced lawyers at Phillips Law Group have obtained hundreds of millions in compensation on behalf of our clients. We charge no upfront fees for taking your case. In fact, we do not get paid until the end of the legal process, and then only if we recover compensation for your damages.
There is no risk in meeting with one of our lawyers for a free legal consultation.
Phillips Law Group. Local lawyers here to help. 1-800-706-3000
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