What To Expect from Auto Accident Settlements

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The purpose of an auto accident settlement is to make an accident victim whole again, both physically and financially. The settlement amount awarded should allow a victim to afford proper medical care, repair their vehicle, and return to the state they were in before the accident. For these reasons, the average car accident settlement amount varies significantly on a case-by-case basis.

If you’ve recently been involved in a motor vehicle accident, whether it was a car crash or motorcycle accident, you likely have a ton of questions. How will you seek reimbursement for your medical bills? How can you afford to attend physical therapy if you can’t return to work? If you’re unsure about a fair settlement amount for your injury claim, you’ve come to the right place.

Here is what to expect from auto accident settlements, from the type of injuries you can include in your injury claim to the unique factors that can impact your settlement amount.

What Damages are Included in a Settlement Amount?

Damages in a car accident case refer to compensation for any type of physical injury, property damage, or other types of losses caused by the crash. The amount of damages included in a settlement amount depends on the losses suffered by the accident victim physically, mentally, and financially. The two types of damages awarded in a car accident case are compensatory and punitive.

1. Compensatory Damages

The average car accident settlement always includes at least one type of compensatory damages, which are meant to compensate an accident victim for injury or loss. Though the losses in an injury claim are often financial, such as medical expenses, compensatory damages can include more than just the costs used to treat injuries.

Compensatory damages are separated into economic and non-economic damages.

Economic damages compensate an accident victim for monetary losses caused by the crash. Also called special damages, these losses are tied to specific monetary amounts like itemized bills or receipts. The most common examples of economic damages are medical bills for hospital or doctor’s visits, medical expenses tied to surgery or physical therapy, and repair bills for property damage. Lost wages and the loss of earnings/loss of future earnings due to the injury are also common.

Non-economic damages compensate an accident victim for non-monetary losses caused by the crash, so they have no specific monetary value. Also called general damages, these damages reimburse victims for the harm they have suffered emotionally, physically, and mentally. The most common non-economic damages included in an injury claim are pain and suffering, mental anguish, and emotional distress.

Some of these damages are considered taxable income of an accident settlement, while other parts cannot be taxed. For example, lost wages are subject to tax, and compensation for medical bills is not.

2. Punitive Damages

Punitive damages are intended to punish the individual at fault for a car accident and deter future bad conduct. These types of damages are not common in the average car accident case. They are typically reserved for more heinous motor vehicle accidents, such as life-threatening collisions with a semi-truck or accidents caused by a drunk driver.

Punitive damages are always considered taxable income.

What Personal Injuries Affect a Car Accident Settlement?

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A car accident injury can occur from head to toe, so it’s no surprise that several types of injuries can be included in a personal injury claim. Injuries that require more medical treatment are typically awarded more value in a settlement. For instance, a serious injury like a lost limb will generally incur a higher settlement payout than a minor injury like a bruise.

Take a look at the types of injuries that can affect the average auto accident settlement.

Soft Tissue Damage

Soft tissue damage is the most common type of injury sustained in a motor vehicle accident. Soft tissue damage occurs when one of the soft tissues of the body — muscles, tendons, ligaments, or bursae — becomes overstretched and inflamed. The blunt force trauma of a car crash is often responsible for several types of soft tissue damage, including:

  1. Contusions (bruises) are caused by broken blood vessels beneath the skin’s surface.
  2. Sprains occur when muscles and ligaments stretch and tear.
  3. Strains occur when tendons stretch and tear.
  4. Tendonitis is caused by inflammation in the tendons.
  5. Bursitis is caused by inflammation in the bursae that support other soft tissue and joints.

The severity of the injury will determine how much soft tissue damage will impact your car accident settlement. Most contusions do not require medical care, meaning they will not be cause for compensation. Other soft tissue injuries, especially severe strains and sprains, will require several weeks to several months of medical treatment to fully heal.

Whiplash or Neck Sprain

Whiplash is the blanket term for a neck injury caused by the head and neck’s rapid back and forth motion during a car crash. The force of impact of a car accident forces the soft tissues in the neck, including muscles and tendons, to stretch in unnatural directions. These tissues can completely tear in severe cases, creating pain and serious cognitive symptoms like memory loss.

More severe whiplash symptoms will increase the average settlement amount. Whiplash that results in shoulder and neck pain, memory fog, and temporary memory loss for several months, will incur a higher settlement than whiplash that causes minor discomfort for a few weeks. Whiplash also causes many accident victims to miss work, which can result in higher lost wages.

Bone Fracture

A bone fracture, also known as a broken bone, is very common in a personal injury claim. Fractures are typically caused by coming into contact with hard surfaces of the vehicle, like the steering wheel, during a crash. Common bone fractures include the nose or eye sockets, fingers, wrists, arms, and knees. Complete fractures that require surgery often incur a higher payout than partial fractures.

Vertebral Damage (Back Injury)

The spine is made up of several small bones called vertebrae. A jelly-like cushion called an intervertebral disc separates each vertebra. There are more than four dozen vertebrae and discs in the spine, and these small structures are incredibly vulnerable to damage during a crash. In fact, one of the leading causes of a back injury after an accident is vertebral damage.

The impact of a crash can fracture one or several vertebrae, creating what we know as a broken back. Damage to vertebrae often impacts the spinal discs, causing a herniated disc or ruptured disc. These injuries can also cause a pinched nerve, creating pain symptoms that radiate to the arms and legs. The more severe the vertebral damage, the higher the auto accident settlement.

Spinal Cord Injury

The spinal cord is a highly-sensitive bundle of nerves protected by vertebrae. It can become injured if damage to the vertebrae is severe or an object penetrates the spine. The spinal cord is responsible for communication between the brain and the rest of the body, so a spinal cord injury can have severe and long-lasting repercussions.

The most common repercussion of a spinal cord injury is partial or complete paralysis in one or both arms or legs. These injuries often require several rounds of surgery, expensive medical equipment, and even at-home care. When coupled with lost wages and the loss of future income, the settlement amounts for spinal cord injuries are typically much higher than the above injuries.

Traumatic Brain Injury (TBI)

A traumatic brain injury (TBI) is a type of brain damage caused by a direct blow to the skull. In a motor vehicle accident, traumatic brain injuries are typically the result of an accident victim slamming their head against the steering wheel or side window. There are different types of TBI, including closed brain injury and penetrating brain injury, that impacts an injury settlement.

A closed brain injury is caused by a rapid back and forth movement inside the skull that bruises the brain tissue. A common example of a closed brain injury is a concussion. A penetrating brain injury is caused when an object like a shard of glass pierces through the skull to damage brain tissue. Either type of TBI can cause substantial medical bills and higher compensatory damages.

Internal Organ Injury

In addition to the brain, many other internal organs are at risk of injury in a car crash. Injuries from seatbelts and airbags plus blunt force trauma can cause damage like organ compression or internal bleeding. Internal organ injuries often included in an auto accident settlement include the liver, kidneys, bile duct, and even the heart.

Limb Loss or Permanent Scarring

Limb loss occurs when a car accident victim must have a limb amputated due to serious injury or when the limb is severed at the scene of the crash. These victims must obtain costly medical equipment, such as wheelchairs or prosthetics, which can increase the value of a settlement. Permanent scarring is less severe than limb loss but can also increase the settlement payout.

What Other Factors Impact Auto Accident Settlements?

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While physical injuries play a significant role in the value of accident cases, several other details impact the overall auto accident settlement amount. From no-fault and negligence laws to property damage and auto insurance, here are the factors that can influence your settlement offer.

Accident Victim’s Medical History

Can previous injuries impact the settlement value of your case? Unfortunately, your medical history can affect your personal injury settlement, especially if you’ve suffered previous damage to the same areas as your current injuries.The insurance company can try to claim that your current injuries have been caused by previous damage and decrease your settlement.

A common example of when medical history can be problematic is if an accident victim with a documented herniated disc suffers additional back injuries during a crash. The insurance company can argue that the “new injuries” are a worsening of old injuries and refuse or limit the payout. Be sure to gather as many medical records as possible to protect your right to compensation.

No-Fault and Negligence Laws

No-fault and negligence laws are legal factors that influence a car accident claim; however, these laws vary by state. Kentucky is a choice no-fault and pure comparative negligence law state. On the other hand, Virginia is an at-fault state and pure contributory negligence law state. To better understand how these laws impact auto accident settlements, let’s take a deeper look at each.

Fault laws determine which insurance policy an accident victim should make their initial injury claim against. A no-fault state means motorists first file an insurance claim with their own insurance company to gain compensation for medical bills, property damage, and lost wages. An at-fault state means motorists file a claim with the at-fault driver’s insurance company first.

Negligence laws determine how responsibility is distributed for a crash. Kentucky is a pure comparative negligence state, which means that responsibility for a crash is distributed according to the percentage of each driver’s negligence. Under Kentucky’s auto accident laws, each driver’s compensation is decreased by their percentage of fault — so, if you’re found to be 40% at fault for your accident, your compensation will be reduced by 40%. If you’re 0% at fault, your compensation will not decrease at all.

Property Damage Costs

Property damage is a type of economic compensatory damage that can dramatically increase your total auto accident settlement. If your vehicle was badly damaged in a crash, you will receive the amount necessary to cover the repair bills. If your vehicle was totaled in an accident, you could receive substantially more money to replace your previous vehicle.

Several factors influence property damage costs, including the damaged vehicle’s make, model, and year. Newer and more expensive vehicles with more expensive parts typically require costly labor that can increase repair fees. These vehicles also have a higher replacement value. In addition to the value of the vehicle, the following auto insurance factors can also affect settlement amounts.

Auto Insurance Policy Details

The amount of auto insurance coverage for both the accident victim and the at-fault driver can influence the total settlement amount. For instance, accident victims in the no-fault state of Kentucky must file an injury claim with their own insurance policy before pursuing additional forms of compensation.

If a victim has $10,000 of Personal Injury Protection (PIP) no-fault insurance, they will only receive compensation up until the $10,000 policy limits. In an at-fault state like Virginia, a victim can file an insurance claim with the at-fault driver. The tentative compensation can be higher if the at-fault driver has higher policy limits.

Settlement amounts also rely on negotiations between the accident victim and the insurance company. If a victim is not offered a sufficient amount of compensation, they can challenge the insurance company up until the at-fault driver’s policy limits. If this amount is still insufficient, a victim can file a lawsuit.

Representation by a Car Accident Attorney

From learning fault and negligence laws to negotiating with the insurance company, there is a lot of expertise required to obtain an auto accident settlement. While legal blogs such as this one can be helpful to prepare for a settlement, it’s best to consult with a knowledgeable car accident lawyer.

A lawyer can represent you throughout your personal injury case and help gather medical history and documentation. They are also well-versed in average car accident settlement amounts and can represent you in negotiations with the insurance company to ensure you are offered a fair payout.

Statute of Limitations for the Case

A statute of limitations is a law that defines the time period during which an accident victim can seek compensation. In Kentucky, the statute of limitations for auto accidents is two years from the day of the accident or last no-fault payment. If you’re unsure how much time you have left to file a personal injury case for a car accident, consult with a personal injury attorney immediately.

What if the Insurance Company Doesn’t Offer a Fair Settlement?

If the initial settlement offer for your insurance claim was dramatically less than what you anticipated, do not stress. It’s uncommon for the insurance company to ever make a fair settlement offer right away. This is why the insurance company allows for negotiations. After you’ve submitted your initial claim, you can speak with an insurance adjuster regarding your settlement.

If you decide to move forward with negotiating, reach out to a local personal injury law firm and speak to a Kentucky automobile injury attorney before extending or making any settlement offers.

Personal injury attorneys are familiar with the legal jargon and calculations used by insurance adjusters and can help translate this information into details you can easily understand.

If your attorney cannot reach a fair settlement negotiation with the insurance company, they can file a lawsuit on your behalf. This lawsuit will include the same damages cited in your injury claim, including economic, non-economic, and punitive damages. An attorney will handle all of the legwork for the lawsuit, so you can focus on healing.

Let David Bryant Law Help You Get the Compensation You Deserve

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Are you unsure how to navigate a personal injury settlement? You’re not alone. Hundreds of people are injured in car accidents each day, and dozens struggle to seek the proper reimbursement for their losses. Personal injury lawyer David Bryant is here to help car accident victims obtain compensation for their physical, emotional, and mental damages.

If you’ve been involved in a car accident that was limited or no fault of your own, reach out to David Bryant Law for a free consultation with a car accident attorney. We’ll review the details of your case to formulate the best plan of action together. Contact us today to take the first steps towards the auto accident settlement you deserve.

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David G. Bryant is certified to practice in all state courts in Kentucky, and federal courts in the Eastern and Western districts of Kentucky, Southern District of New York, Southern District of West Virginia, Northern District of Ohio, Middle District of Tennessee, and Western District of Pennsylvania. He is licensed to practice before the United States Supreme Court and the Sixth Circuit Court of Appeals.