Your claim is worth what an insurance company is willing to pay to settle it for. Failing settlement, it is worth what a judge assesses your claim is worth.
That may seem unkind, but in truth, a lawyer can only advise what they believe the value of your claim is. This advice is useful to judge if an offer is fair.
Why don’t insurers pay what the claim is worth? Well, the value of a claim is always a matter of dispute and opinion. There is no one right answer. Different judges will value it differently. You also need to consider risks, such as losing in Court.
Ok, that was a bit longer than short answer suggested in the title! Here comes the long answer.
An injury compensation claim is assessed like this:
1. What injuries were caused in the accident?
2. How did those injuries impact the person?
3. What out of pocket losses has the person suffered, and will suffer in future?
The theory behind compensation is to put the person back as if no injury had been suffered. I.E. repay their losses and add something for their suffering. The Court cannot undo the accident, but the law provides a financial benefit to offset this impact.
Damages are broken down into 4 areas, or heads of damage, for ease of understanding.
1. General Damages – pain, suffering and impact on living;
2. Special Damages – out of pocket treatment costs, paid care and modifications to car / house;
3. Economic Loss – loss of wages or ability to earn wages;
4. Unpaid care needs – volunteer caring provided by family and friends.
Lastly, an insurer may have to contribute towards your legal costs.
General Damages – almost all claims now have a regulated method to calculate general damages, and it includes determining the accident caused injuries, their assessment by a medical expert and placing that assessment in a table and finding the corresponding dollar value for that assessment.
Sadly, often quite debilitating injuries such as soft tissue neck or back injuries have low permanent impairment assessments, meaning a low general damages assessment, which seems pitifully below what a fair-minded person would see as the impact of their injuries in their life.
Special Damages – apart from refunds to government like Medicare and WorkCover paid treatment, there is also any treatment gap charges, travel ($/km) and parking when incurred for treatment needs, anything found to be reasonably needed and funded by the injured person (some non medical treatment will not be covered), medical aides, paid care and modifications.
The special damages assessment will cover future needs as well.
It is important if you pay for someone to mow your lawn or clean your house to get receipts from a commercial supplier of such services. It can be hard to claim this cost if you use the neighbour teenager who is not running a business.
Economic Loss – this covers lost earning capacity, or in lay terms, lost ability to earn wages. Usually a large part of the claim, and subject to the most debate and negotiation.
A simple example is a carpenter who was out of work for 15 weeks because of his injuries, and who had demonstrated earnings of $1,000 per week, would claim $15,000 plus super and interest for past economic loss (if that was the entire impact). Then depending on his recovery and medical assessments, their may also be a future impact and therefore a lump sum claim to cover potential losses for the rest of his working life.
Voluntary Care – most claims now require a need for care of 6 hours per week for 6 months before any claim for care can be made. Work injury claims have even greater restrictions on claiming voluntary care, and careful thought should be given to engaging paid care services to ensure an injured person is properly covered for their losses.
The care must be found to have been needed by the injured person and can include direct nursing attendance style care (eg helping them to dress, shower, change bandages), driving to medical appointments, cooking and cleaning for them and other domestic household tasks.
If it is clear a claim will be made for voluntary care, a detailed diary should be kept and signed off by the carer and injured person each week, showing what care was provided and for how long.
Legal costs – the laws now limit how much an insurer contributes to legal costs, if anything at all. If they are required to pay legal costs on a standard basis, this will roughly be about half your legal bill.
So, to answer your question, we first need to know a lot of information about your injuries and how they have impacted your life. A lawyer can then advise their opinion on what it is worth. A likely settled outcome will usually be for less than this advised figure, but it will help you decide what is a fair offer and whether to go further with your claim. Matus Lawyers can help you if you have any questions.
Disclaimer – This article is provided for information purposes only and should not be regarded as legal advice.