No Win, No FeeIf you’re considering filing a personal injury claim, you might be wondering, “How is personal injury compensation calculated?”. To help, we’ve written this article to give you some idea about the different factors considered when calculating personal injury compensation amounts. After a claim is settled, you cannot make another claim for the same injury so it’s important to think hard about how your injuries have already affected you and how you might continue to suffer in the future.
If you are thinking about claiming compensation for a personal injury, feel free to contact us. You will receive free legal advice as part of a free initial consultation and your options will be explained. If your solicitor believes that you’ve got a fair chance of being paid compensation, they’ll offer to represent you. As all claims are managed on a No Win, No Fee basis, you won’t be charged legal fees unless you’re compensated.
Read on to find out more about how personal injury compensation amounts are calculated or feel free to call us on 0800 652 1345.
What factors are considered when calculating personal injury compensation?
When calculating personal injury compensation, several factors may be taken into consideration depending on the specific circumstances of the case. These typically include:
- The severity of the injury. The extent and seriousness of the injuries suffered by the claimant, including the type of injury and its effect on their physical and mental well-being.
- Pain and suffering. The physical pain, emotional distress, and mental anguish experienced as a result of the injury.
- Medical expenses. The cost of medical treatments, therapies, medications, and any future medical expenses due to the injury.
- Loss of earnings. Compensation for the income lost due to the injury, including past and future loss of earnings, diminished earning capacity, and the potential impact on the claimant’s career.
- Rehabilitation and therapy costs. The costs of rehabilitation for the injury, physical therapy, occupational therapy, counselling, or any other necessary treatments to help with recovery.
- Disability or impairment. Compensation for any permanent disability, impairment, or loss of function caused by the injury.
- Loss of amenity. The limitations imposed on the claimant’s ability to perform their usual daily activities, hobbies, or personal relationships due to the injury.
- Pre-existing conditions. Whether the claimant had any pre-existing medical conditions that may have worsened or been exacerbated by the injury.
- Future care and assistance. Compensation for ongoing care needs, assistance, or accommodation required because of the injury.
- Contributory negligence. If the claimant is found partially responsible for their injury, their own negligence may affect the overall compensation amount.
What types of damages are included in personal injury compensation?
Personal injury compensation typically includes two types of damages that aim to provide financial recovery and assistance to the injured party. They are:
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General damages
General damages is the term used to describe compensation that covers your pain, suffering and loss of amenity caused by your injuries. Some common physical injuries are:
- Broken bones.
- Lacerations.
- Head injuries.
- Internal organ damage.
- Strains, sprains and tears.
- Spinal injuries.
- Facial injury.
Also, you could be compensated for any psychological injuries such as:
- Depression.
- Anxiety.
- Flashbacks and nightmares.
- Post-Traumatic Stress Disorder (PTSD).
- Embarrassment.
How is general damages compensation calculated?
Generally, personal injury claimants need to be independently assessed by a medical expert. The solicitor will book an appointment for the client where the specialist will examine the injuries they’ve suffered to determine their prognosis. They’ll also ask a series of questions about the way the injuries have affected the claimant.
The report that comes from the meeting will be used by the solicitor to get an understanding of the injuries. Rather than calculating how much compensation could be paid for their injuries, the solicitor will refer to guideline compensation figures produced by the Judicial College. These amounts are based on the severity of the injury so, for example, someone whose hand had been amputated following an accident would be awarded more than someone who’d recovered after fracturing bones in their hand.
How is compensation for loss of amenity calculated?
Loss of amenity is harder to calculate and the amount you could receive will depend on several factors. An example of loss of amenity might include where a neck injury sustained in a fall at work means that you can no longer play rugby.
To calculate loss of amenity compensation, your solicitor will assess any lifestyle changes you’ve made because of your injuries and how long you used to spend doing a particular activity that it’s now no longer possible to participate in.
Loss of amenity can also be calculated to cover temporary loss of enjoyment.
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Special damages
The term special damages refer to any costs, charges or expenses you’ve incurred as a result of your injuries. Importantly, the value of any special damages paid should never exceed your actual costs.
How is special damages compensation calculated?
The calculation of special damages typically involves considering several key factors including:
- Lost earnings. If your injuries prevent you from earning, your solicitor will use wage slips and similar documents to calculate how much compensation you’ll claim. This amount will factor in any sick pay (including SSP) you received from your employer. If you’re self-employed, your accountant might be asked to provide proof of your usual income levels.
- Future loss of earnings. If you’ve suffered an injury that will reduce your capacity to earn in the future, this may be reflected in your settlement. To calculate future loss of earnings, your solicitor will consider your age, current income and job prospects.
- Care costs. You could receive compensation to cover the cost of a carer. For shorter-term injuries, this might cover the time a loved one spent supporting you and helping with daily tasks while you were injured. For more serious cases, your solicitor may need to calculate how much a professional carer will cost and how long you’ll need that level of support.
- Medical expenses. The injured party can claim compensation for past medical expenses, including hospital bills, doctor visits, surgeries, medication costs, rehabilitation services, and any other necessary treatments. Future medical expenses may also be estimated based on medical expert opinions and anticipated ongoing medical needs.
- Travel expenses. If you are unable to drive as you normally would while you’re injured, you may need to work out the cost of alternative travel arrangements. Also, you could claim additional fuel, parking or public transport costs linked to your medical appointments.
- Personal property costs. If any of your personal property was damaged in the accident, your solicitor will find out the cost of replacing them. This could include clothing, jewellery, glasses or your phone.
- Home and vehicle adaptations. For serious injury claims, calculations may be needed to make changes to your home to help you deal with any ongoing disabilities. For example, you may need ramps, handrails or lifts installed to make accessibility easier for you. Generally, architects or building firms will be asked to quote for the work so that your solicitor can put a figure forward as part of your claim.
Special damages can make up a large part of any personal injury claim. It’s therefore important to spend some time considering everything before filing your claim. Our team of solicitors will have likely dealt with cases similar to yours so will understand what you might need to claim for. They’ll always try to ensure any settlement is fair and that you receive the maximum compensation possible.
Do you pay tax on personal injury compensation?
We’re often asked, “Is personal injury compensation taxable?” and the answer is no. In the UK laws are in place that make any damages you receive following a personal injury claim tax-free. That’s the case whether you receive a lump sum or whether your compensation is paid annually.
When compensation is calculated, interest may be added to your payment to cover the period from the date you were injured and the date the claim was settled. The defendant will have already deducted the tax from the interest so you won’t have to pay it.
What deductions may be made to my compensation settlement?
If you win your claim, it’s possible that some deductions will be taken from your compensation before it’s paid to you. These can include:
- Success fees. Our panel solicitors provide a No Win, No Fee service that allows you to receive expert legal representation without paying legal fees upfront. If your case is won, your solicitor will be paid a success fee. This is listed in your Conditional Fee Agreement (CFA) before you agree to proceed. The maximum success fee that can be deducted when using a CFA is 25 per cent of any settlement you receive.
- Split liability. In some cases, you might need to agree that you were partially to blame for your accident. For example, you could be 20% to blame for the accident and the defendant 80%. In this scenario, your personal injury compensation would be calculated as normal and then reduced by 20% to reflect your share of the blame.
- ATE insurance. If a claim is lost, you might have to pay the defendant’s legal costs which can be quite expensive. As such, your solicitor may take out After The Event insurance to make sure you don’t need to pay the defendant’s costs yourself. If your claim is successful, the cost of the ATE insurance policy might be deducted from your settlement figure.
- Additional legal fees. While the success fee covers your solicitor’s costs, it won’t cover additional fees such as the cost of the private medical assessment. As such, these fees would be deducted from your settlement before you are paid.
Don’t be too concerned about these deductions at this point. We would suggest that you discuss any fees you might have to pay with your solicitor before your claim begins.
How to start a personal injury compensation claim
Now that you’ve read how personal injury compensation is calculated, please feel free to call with any further questions. Our team can be reached on 0800 652 1345. When you call, an advisor will answer any questions you think of and provide free legal advice about your claim.
While there’s no obligation to start a personal injury compensation claim, a solicitor from our panel may offer to help if your claim is strong enough. If you agree to work with them, your claim will be handled on a No Win, No Fee basis.
If you have any further questions about how is personal injury compensation calculated, please feel free to connect to our live chat service or claim your free consultation here.
