After being involved in an accident and sustaining injuries and other losses, taking legal action should be a top priority to ensure you recover adequate compensation. If you are filing a claim or lawsuit, it is important to understand the difference between economic and non-economic damages. For more information and skilled advice, contact a Middlesex County personal injury attorney today.
What is the Difference Between Economic and Non-Economic Damages?
There are a number of differences between economic and non-economic damages. While both are important, it can be helpful to understand how each type of compensation varies. Consider the following.
The purpose:
The purpose of each type of compensation is different. Economic damages serve as a way to reimburse a victim for actual financial losses that they have sustained. This includes any money spent that is necessary and directly linked to the accident. A victim should not have to suffer financially due to an accident that was not their fault. Economic damages ensure that they do not.
Non-economic damages, on the other hand, are designed to compensate a victim for non-monetary losses and suffering that they sustained, like emotional suffering, discomfort, and new limitations in life. There is no way to take away the emotional and other suffering, but providing additional compensation in the form of non-economic damages can help the victim feel less slighted and use that money toward bettering themselves.
The types of losses:
The types of losses that each category of damage compensates are also different. Main examples of economic losses that can be compensated include the following.
- Medical expenses like hospital stays, surgeries, doctor visits, prescription medication, rehabilitation, future medical costs, and more
- Lost income from time taken off work to recover or from a new diminished earning capacity
- The cost of damage to personal property
- Other out-of-pocket expenses like modifications to the home or vehicle, transportation to medical appointments, hiring household assistance, etc.
Non-economic losses can include the following.
- Physical pain and suffering experienced during recovery
- Emotional distress, like the development of anxiety, depression, PTSD, and other mental conditions
- Loss of enjoyment of life, as in an inability to participate in activities that once brought joy
- Loss of consortium, as in intimacy or closeness with family and friends
How they are calculated:
The ways that each damage is calculated also vary. Economic damages are easily measured as they are objective and quantifiable. To calculate economic losses, you can simply collect medical bills, receipts, pay stubs, and other documentation before adding up the total.
Non-economic damages, however, are not as simple. These are subjective damages as the losses are not accompanied by a clear monetary value. Instead, you will likely rely on expert testimony and tools like the multiplier method to determine the extent of the injury’s effect on your life before calculating a fair amount of damages.
If you have questions or concerns about compensation in your case, reach out to an experienced personal injury attorney today.
