How Car Accident Settlements Are Calculated

Most Arizona car accident cases end in insurance settlements rather than a trial. Unfortunately, some people settle for less than they deserve. One key reason for this is that many victims don’t know how car accident settlements are calculated and how much their claims might be worth. This is most likely to happen when car accident victims lack experienced legal representation.

If you suffered injuries in a collision and find yourself wondering, “How are car accident settlements calculated?” contact the team at Silkman Law Firm Injury & Accident Lawyer for a free consultation. We’ll help you understand how much your claim may be worth.

Key Factors in Car Accident Settlement Calculations

Understanding the critical factors in calculating personal injury settlements can help clarify your claim’s actual value and whether you’re getting a fair deal from the insurance companies. Some important elements used to calculate a car accident settlement include:

• The severity of your injuries – The extent of your injuries is perhaps the most significant factor in determining a car accident settlement. Severe injuries like broken bones or head trauma often result in high medical bills and potential long-term care needs, along with substantial pain and suffering. All of these losses add up and can increase your claim’s value.
• Medical expenses – This includes your hospital bills, rehabilitation expenses, the cost of prescription medications, and any future medical treatments you need. Higher medical costs typically increase settlement amounts, especially if you need ongoing treatment. If your injuries require surgeries or extensive therapy, your compensation should reflect these high expenses.
• Lost wages – If your injuries cause you to miss work, you may seek compensation for your lost income. The longer your recovery, the higher this part of your settlement can be. For injuries that affect your ability to work in the future or require you to take a lower-paying job, you can seek further compensation for your lower earning potential.
• Pain and suffering – This factor accounts for your physical pain and emotional distress from a collision. Severe or long-lasting discomfort can lead to a larger settlement. Insurance companies often use a multiplier method to estimate this amount, applying a multiplier to your economic losses based on the severity of your injuries and their impact on your life.
• Insurance coverage limits – Arizona’s insurance laws and the coverage of all involved parties influence how much you can recover. If the at-fault party has low liability limits, your compensation may be capped at that amount, regardless of your total losses. In accidents involving multiple liable parties, each party’s available insurance coverage can affect how much you ultimately receive. Understanding your own policy, such as whether your uninsured or underinsured motorist coverage might apply, can help you pursue compensation if the other driver doesn’t have enough insurance.