Key Factors Influencing Personal Injury Settlement Amounts

Ever wonder how much your personal injury case might be worth? Each year, thousands of people are injured due to accidents that were not their fault. As you start to pay medical bills and miss work, one question is always in the back of your mind… "How much is my case worth?" Well, here's the deal…

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Personal injury settlements can range from a few thousand dollars to millions of dollars. The difference between a lowball offer and fair compensation often comes down to understanding the factors that influence personal injury settlement amounts.

What you'll learn:

The Truth Behind Personal Injury Settlement Amounts

Injury Severity: The #1 Determinant of Value

Liability and Comparative Negligence

Economic and Non-Economic Damages

Policy Coverage Limits & Insurance Issues

The Importance of Evidence

The Truth Behind Personal Injury Settlement Amounts

The majority of people have this assumption. It's not true.

Personal injury settlements do not come from a formula. Not even close.

Recent data shows the average personal injury settlement to be around $55,056. But here's what you need to understand about that data: they received over 5,800 personal injury cases, each year, and every case was different.

The truth is much more complex than people think.

Settlement values can often range from $10,000 to over $75,000 for most injury claims. Severe injuries? Those can quickly escalate to hundreds of thousands or millions of dollars.

If you've been involved in a personal injury incident, it's important to have an experienced injury attorney in Niagara Falls who knows the different aspects that make a personal injury case valuable, as well as what insurance companies value during a settlement negotiation.

Here's the reality: Knowing these factors and understanding what makes up a strong personal injury case will help you better protect your claim from being underpaid by an insurance company.

Injury Severity: The #1 Determinant of Value

The most important factor that determines your personal injury case value is the severity of your injury.

Why? Simple math.

The more serious your injuries are, the higher your medical expenses, recovery time, and overall impact on your life will be. Insurance companies know this, so they adjust their settlement offers accordingly.

Minor injuries like soft tissue damage, sprains, or whiplash typically settle for $2,000 - $25,000.

Moderate injuries, such as broken bones or surgeries, range from $25,000 - $100,000.

Severe injuries like traumatic brain injuries, spinal cord damage, or permanent disabilities can result in settlements from $100,000 up into the millions of dollars.

Statistics show that about 95-96% of all personal injury cases settle before going to trial. The main reason insurance companies care about injury severity is because they're always evaluating whether a case falls within a particular settlement range.

If your injury has a significant impact on your life, your potential settlement amount is going to be much higher.

Liability and Comparative Negligence

This is one of the more interesting topics to talk about, in my opinion…

Even if you have severe injuries, your settlement can still be dramatically reduced if you're partially at fault for the incident. Here's how the majority of states operate in terms of "comparative negligence" rules:

For example: If you're deemed to be 20% at fault in an accident, your potential settlement award gets reduced by 20%. That means a $100,000 settlement would be reduced to $80,000.

This is why liability and negligence are so critical for your personal injury case. The clearer the evidence that the other driver was at 100% fault, the higher your settlement amount should be.

Rear-end collisions, drunk driving accidents, or clear traffic violations are cases with very clear liability

Intersection accidents, slip and fall accidents, and multi-vehicle pileups are more complicated liability cases

The most important thing with your case is to preserve solid evidence early on to help establish fault. Photos, witness statements, police reports, and expert witnesses can all play a role in determining and protecting your potential settlement amount.

Economic and Non-Economic Damages

Personal injury settlement amounts are calculated by using the two categories of damages mentioned above.

Economic damages include things like medical expenses, lost income from missed work, property damage, and rehabilitation costs.

Non-economic damages cover the pain and suffering, emotional distress, and loss of enjoyment of life that often accompany an injury.

The kicker: Non-economic damages are typically calculated using the "multiplier method." Your economic damages get multiplied by 1.5 to 5, depending on how severe your injuries are.

The less severe your injuries, the closer you should be to the 1.5 to 2 multiplier. The more severe the injury, the higher the multiplier will be to account for things like pain and suffering and future suffering.

This is another area where good medical records and proper documentation are crucial to proving the true value of your personal injury case.

Policy Coverage Limits & Insurance Issues

There's one other thing that many people don't realize until it's too late…

The at-fault party's insurance coverage limits can cap your personal injury settlement amount even if you have severe injuries.

Data reveals that the average auto liability claim for bodily injury in 2022 was $26,501. So what happens if your medical bills end up being $30,000?

You're SOL.

Many drivers only carry the minimum insurance coverage, and if the at-fault driver has $25,000 insurance coverage and your total damages are $100,000, the insurance company is only going to pay out up to their policy limits, even if you have serious injuries.

The only options to pursue: Your own uninsured/underinsured motorist coverage or going after the at-fault party's personal assets.

This is one of the reasons it's so important to have an experienced lawyer who can help you identify all available insurance policies.

The Importance of Evidence

The one thing that makes the biggest difference in a strong personal injury settlement and a weak one?

Evidence.

Having strong evidence to support your personal injury claim can significantly impact your negotiating position with insurance companies. Insurance adjusters are trained to spot weak cases quickly, so the more solid proof you have, the better position you're in to demand a fair settlement.

Strong evidence can include: Clear photos, witness statements, a police report, medical records, and expert witnesses.

With strong evidence: Insurance companies offer higher settlements to avoid losing at trial

With weak evidence: Insurance companies will lowball you

The time factor matters here, too. As time goes on, the scene of an accident is quickly cleaned up, witnesses lose memory of details, and security footage is erased. The sooner you act, the better your chances are of building a strong case.

Insurance Company Tactics You Need to Know

Insurance companies are not your friends. They are for-profit companies, and their number one goal is to pay out as little money as possible, on every claim they process.

Here are some common insurance company tactics:

Making early lowball settlement offers, before you know the full extent of your injuries

Requesting recorded statements from you to look for inconsistencies

Arguing that your injuries were pre-existing and had nothing to do with the accident

The best advice: Never accept a settlement offer from an insurance company without consulting a lawyer.

Once you accept a settlement offer, that's it. You cannot go back and ask for more money later. The reality is that insurance companies know that people with lawyers end up with higher settlements. Lawyers know how to properly value a case, gather strong evidence, and negotiate with insurance companies.

The majority of personal injury lawyers work on contingency, which means they only get paid if you win.

Wrapping It Up

Understanding the key factors that can influence a personal injury settlement amount can help you be more in control during this process.

Statistics show that motor vehicle accidents account for 52% of all personal injury claims, with 61% success rates. Medical malpractice settlements average much higher at $423,607.

Remember, all personal injury cases are different, but these five factors will always come into play. The more you know about them, the more likely you'll be able to get the fair compensation you deserve.

Don't let an insurance company get away with lowballing you. Know what your case is worth, and fight for every dollar that you're owed.