What Are Economic Damages?

Sustaining an injury in an accident can cause significant physical, mental, and emotional pain and suffering. Accident victims may spend months in recovery. Some individuals sustain permanent impairments that cause pain and suffering for the rest of their lives.

An accident victim may also incur substantial financial losses because of the accident. The insurance company for the at-fault party is often responsible for the victim’s losses after their injury, including economic damages.

Economic damages represent a victim’s financial losses related to their accident, including future anticipated losses. These damages make up a large portion of a victim’s claim or case.

Let’s look at some of the economic damages that are included in most personal injury cases. 

Medical Expenses 

Medical bills make up a large share of most awards in an injury case. Treating an injury can be expensive. An injury victim shouldn’t be on the hook for these expenses; the negligent party should. 

Examples of medical expenses you could recover in an injury case include:

  • Ambulance services
  • Emergency room costs
  • Surgeries 
  • Hospitalizations
  • Medications
  • Medical equipment
  • Physicians’ bills
  • Therapy costs (i.e., physical, occupational, emotional, vocational, etc.)
  • Diagnostic tests and labs

The severity of the injury often influences the extensiveness of a victim’s medical expenses. The more severe the injury, the greater the medical costs. 

Lost Income and Benefits

Lost wages are generally another large component of an economic damages award. You are entitled to reimbursement for your past and future lost earnings because of the accident or injury. However, you are also entitled to compensation for a reduction in your earning capacity.

If you can work, but your injury results in a decrease in income, you are entitled to compensation for the difference. Loss of future earnings is generally the result of permanent impairment or disability.

Also, you should receive compensation for lost benefits and other forms of income. That might include bonuses, commissions, vacation time, or paid time off. In addition, the benefits you had to use during your recovery or the benefits you lost because you could not work should be added to the value of your loss of income claim. 

Other Out-of-Pocket Expenses

You might incur other expenses related to the accident or injury that you can include in economic damages. Examples might include:

  • Assistance with household chores or child care
  • Personal care, including assistance with activities of daily living (i.e., bathing, feeding, dressing, etc.)
  • Home health care or long-term nursing care
  • Travel expenses to and from medical appointments 
  • Modifications of your home or car because of a permanent disability
  • Special medical equipment or supplies

Careful documentation of expenses helps you increase the value of your injury claim. Make sure to document each expense or financial loss by keeping copies of bills, invoices, and receipts. In addition, it can be beneficial to keep a detailed log of your expenses with copies of documentation to support each entry. 

Calculating the Value of Your Economic Damages

Economic damages are a part of almost every type of personal injury case, including motor vehicle accidents, nursing home abuse cases, slip and fall accidents, and dog bite cases. Calculating the value of economic damages generally involves totaling the invoices, bills, and receipts related to a victim’s injury.

However, there could be cases in which expert testimony may be required to value economic damages. 

For example, if you sustained a traumatic brain injury, a medical expert may testify in your case. The medical expert would testify how your brain injury impacts your daily life, such as the need for personal care or your inability to work. Those details are necessary to calculate future medical care and future loss of income.

Likewise, a financial expert may be necessary to assist with the calculation of future loss of income. A financial expert calculates your future lost wages or reduction in earning potential based on a variety of factors. Factors used to calculate earning potential include age, career, education, skills, experience, life expectancy, and market trends.

The key to recovering maximum compensation for your economic damages is the detailed documentation of losses. If you do not prove that you incurred an expense, the insurance company will deny the claim.

For example, you had to pay someone to drive you to and from doctor’s appointments. It will be difficult to prove you sustained the financial loss without proof that you paid that person. 

Therefore, you should have your friend give you a written “bill,” and you pay your friend with a check. That creates a paper trail that an insurance company can follow. It may seem like a lot of trouble, but in the end, it could result in a larger payment for your personal injury claim. 

Call Our Pennsylvania Personal Injury Lawyer Today for a Free Consultation 

Contact or call (717) 231-1640 at our law firm to schedule a free consultation with an experienced Pennsylvania personal injury attorney. Let’s work together to recover the money you deserve for the economic and non-economic damages caused by an accident.