How Are Personal Injury Settlements Calculated?

Every personal injury case is unique, but most settlements hinge on two big categories: economic damages and non-economic damages. Understanding what these are can help you set realistic expectations as your case moves forward.

Economic Damages (Financial Losses)

Economic damages are the measurable, documented costs tied directly to the accident. These include:

• Medical bills: ER visits, surgeries, medications, physical therapy, follow-up appointments, and future medical care.
• Lost wages and diminished earning capacity: This includes the time you missed from work and the long-term impact of your injury on your ability to earn in the future.
• Out-of-pocket expenses: Transportation to medical appointments, medical equipment, or home care assistance.
• Property damage (in motor vehicle cases): The cost to repair or replace your vehicle.

Non-Economic Damages (The Human Impact)

Non-economic damages compensate you for the ways in which the injury has affected your quality of life. These losses aren’t tied to receipts or invoices and may include:

While not an official rule, many insurers use the multiplier method to estimate non-economic damages. What this means is they total your economic damages and multiply that number by a factor (usually 1.5 to 5). The multiplier they decide on depends heavily on:

The more serious and long-lasting the injury, the higher the compensation tends to be. Cases involving traumatic brain injuries (TBI), paralysis, amputations, severe burns, or long-term nerve damage typically result in significantly higher settlements.

Catastrophic injuries, in particular, often require ongoing medical care, adaptive equipment, home modifications, future surgeries, and lifelong support.

Georgia follows a modified comparative negligence rule. This means:

• You can recover damages as long as you are less than 50% at fault for the incident.
• Your settlement is reduced by your percentage of fault.

If the insurance company can pin even 20% of the blame on you, your final payout could drop by 20%. This makes evidence gathering, like photos, witness statements, medical records, and expert opinions, a very important deciding factor in your case.

No matter how strong your case is, your settlement can only go as high as your insurance policy’s limit – unless other parties or policies are available to pursue. For example:

• A commercial vehicle might have a $1 million liability policy.
• A standard driver might only carry $25,000 in bodily injury coverage.

When your damages exceed policy limits, your attorney may need to pursue umbrella insurance policies, third-party liability, employer liability, or product liability avenues to fully compensate you.

Many people focus on what the accident has already cost them, but the largest portion of a settlement often comes from future damages you will incur, including:

Accurately calculating your future damages often requires expert testimony from doctors, economists, job specialists, and life-care planners. The more complicated the injury, the more important this becomes.

While many injury cases resolve with a lump-sum payout, some clients, especially those with long-term needs, benefit more from a structured settlement. This option spreads payments out over time, such as monthly or annual installments, and can provide:

Insurance companies are trained to minimize payouts. An experienced personal injury attorney knows how to counter their tactics by:

Your actions after an accident can significantly impact the compensation you ultimately receive. To protect your claim:

• Seek medical treatment immediately and follow all recommended care.
• Don’t post about the accident or your injuries on social media.
• Keep all medical and expense records related to your injury.
• Avoid giving statements to insurance adjusters without seeking legal guidance first.
• Contact a lawyer early to preserve evidence and so you can recognize and reject a lowball offer.

Determining what your injury claim is worth isn’t something you should handle alone, especially when insurance companies use complicated formulas and other tricks to avoid paying you the full value of what you’re owed. The Dixon Firm has extensive experience handling injury cases across Georgia, including those involving catastrophic injuries, long-term disability, and complicated settlement negotiations. We fight to ensure your settlement reflects every dollar you’ve lost and every hardship you’ve endured.

Contact us today to get started.