Posted by Mark Evans on 07/11/2019

The Difference Between Punitive and Compensatory Damages

When you file a claim for the costs you’ve encountered following an accident, you are asking for payment for the damages you have faced. Damages is a broad term that encompasses the many consequences of an injury or accident.

Though the concept of damages is straightforward, things become a little more complicated when you look at the different types of damages that are awarded to an injured person. There are many ways to categorize damages, but for the sake of simplicity, let’s look at two types of damages awarded in civil litigation: compensatory and punitive damages.

What are Compensatory Damages?

Compensatory damages are the payments you’ll receive as compensation for the costs you have encountered due to another person’s negligence. Compensatory damages include both “economic” and “non-economic” damages.

Economic damages are the financial consequences of an accident and injury. They include medical bills, lost income and property damage. Economic damages should include previous expenses you’ve lost because of an accident, but they should also include the money you will lose in the future, such as future medical care or income that you won’t be able to generate because of diminished work capacity.

Non-economic damages include the physical and emotional consequences of an accident and injury. This means pain, suffering, trauma, disfigurement and any other consequences that aren’t directly related to finances. The fact that they are referred to as non-economic is slightly misleading. For example, pain, anxiety and depression can have very real financial consequences.

What are Punitive Damages?

As opposed to compensatory damages, punitive damages are not awarded in relation to the specific costs an injured person is facing. They are damages designed to punish the person who was negligent. Punitive damages are often levied against a person if their negligence was particularly careless or dangerous. In some cases, punitive damages are awarded when the defendant is being made an example to the public, often in hopes of deterring future negligence.

Punitive damages, also referred to as exemplary damages, are not necessarily common in civil litigation. Substantial punitive damages are awarded in exceptional cases. Thus, attorneys and plaintiffs should not count on punitive damages. The awarding of these damages is contingent on a jury’s decision.

Each state has its own laws regarding punitive damages. For example, in Missouri, judges decide whether a jury should consider awarding punitive damages. Juries in Missouri will consider a number of factors to determine how much to award a plaintiff in punitive damages, including the income of the defendant. The state will also claim half of the punitive damages levied against a defendant.

If you’ve been injured because someone else was negligent, then you have the legal right to pursue payment for the many costs you face. It’s important to know how much you are owed in damages, so you can demand compensation that accurately reflects your costs.

Some damages are more obvious than others. For example, medical bills and lost income are more intuitive than pain and suffering, but it’s always best to consult an experienced personal injury attorney to make sure you aren’t leaving money you deserve on the table. A serious accident and injury can leave someone financially challenged for years, so you should demand payment that factors in the many expenses you’re facing.

Consider contacting an attorney who has handled cases similar to yours, so you can schedule a free consultation. Once you find a lawyer that you feel comfortable with, you can work with them to determine how much you are owed. Your attorney will then get to work on your case to make sure you get payment for the damages you have experienced.

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