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How Is Car Accident Compensation Determined?

January 18, 2023

When you get injured in a wreck that is someone else’s fault, it is important to understand how car accident compensation is determined under Illinois law. It is equally important to know that even if you are rightfully entitled to compensatory damages, this does not necessarily mean you will receive the compensation you deserve. 

To recover the full and fair car accident compensation to which you may be entitled under the law, you need to prove that someone else’s  (i.e., another driver’s) negligence led to the crash. You also need to prove how much you deserve to recover. 

So, how is car accident compensation determined in Illinois? 

Understanding the Two Types of Compensation in a Car Accident Claim 

Under Illinois law, car accident victims can seek two types of compensation (or “damages”) when they suffer injuries due to someone else’s negligence. These are: (i) economic damages, and (ii) non-economic damages. 

Economic damages are those that you can calculate directly. For example, if you have substantial medical bills, these are economic losses that you may be entitled to recover. Other out-of-pocket costs qualify as economic losses as well, as do lost income and benefits. 

Non-economic damages are those that you cannot calculate directly. But, while they may not have a direct economic value, they can still drastically impact your life.

Determining Compensation for Your Economic Losses

Determining compensation for your economic losses starts with adding up your out-of-pocket costs to date. This includes paid and unpaid medical bills, prescription costs, transportation expenses, and any other expenses you have incurred as a result of your injuries. It also includes your loss of income in all forms (i.e., wages, salary, commissions, and tips) and benefits. 

If you have bills, receipts, bank account statements, or credit card statements that reflect these costs, these can all be extremely helpful. Likewise, if you have employment and tax records that document your normal income and your time missed from work, you will want to provide these with your lawyer as well. The key is to be as thorough as possible—if you overlook any of your costs, you won’t be able to go back and ask for more when your claim is over. 

But, your costs to date could represent just a small fraction of your total economic losses. The losses you incur in the future could far exceed the costs you have incurred already. Calculating future economic losses is more complicated, and your lawyer will need to work with your doctors to determine the likely long-term effects of your accident-related injuries. Based on how long it will take you to recover (and if you will be able to fully recover), your lawyer should be able to forecast your long-term out-of-pocket costs and lost earnings.

Determining Compensation for Your Non-Economic Losses

Calculating just compensation for your non-economic losses presents some unique complications as well. As we said above, there is no direct way to place a dollar value on losses that are not economic in nature. Instead, the Illinois courts (and the insurance companies) recognize two primary methods for calculating non-economic damages:

  • Multiplier Method – Based on the severity of your injuries’ long-term effects, your economic losses will be multiplied by a number between 1 and 5 (the “multiplier”). This figure is then added to your economic damages to determine your total compensation. 
  • Per Diem Method – This method still focuses on the severity of your injuries’ effects; but, instead of applying a multiplier to your economic damages, it involves determining a daily compensation rate and then multiplying this by the number of days you are expected to experience the non-economic consequences of your accident. 

Regardless of which method is used, the more evidence you have, the stronger your case will be. To help your lawyer prove the full extent of your non-economic losses, you can keep a diary or journal where you document things like:

  • Your daily pain levels (on a scale from 1 to 10)
  • Days you don’t feel like getting out of bed 
  • Days you miss work because of your physical injuries or psychological trauma 
  • Activities and chores you are unable to participate in or perform 
  • Family events and social gatherings you miss as a result of your accident 

What About Punitive Damages? 

If you have been researching your legal rights or know of someone who has been through a car accident claim before, you may be familiar with the concept of punitive damages. Technically, punitive damages are not compensation. Instead, these damages are paid in addition to car accident victims’ compensatory damages, and they are intended to punish particularly reprehensible conduct. 

But, while punitive damages are intended to punish (and are paid above and beyond car accident victims’ compensation), in Illinois, these damages are still related to victims’ losses to a certain extent. Section 2-1115.05(a) of the Illinois Compiled Statutes states that punitive damages in a car accident case, “shall not exceed 3 times the amount awarded . . . for the economic damages on which such claim is based.”

Talk to a Chicago Car Accident Lawyer for Free

If you have been seriously injured in a car accident in Illinois, we strongly encourage you to speak with a Chicago car accident lawyer at Coplan + Crane about your legal rights. It costs nothing to find out how much you are entitled to recover, and you can hire an attorney to represent you at no out-of-pocket cost.

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To arrange a FREE, no-obligation consultation at Coplan + Crane, call (708) 358-8080 or request an appointment online today.