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How Are Car Accident Settlements Calculated?

People pursuing compensation after suffering injuries in a motor vehicle crash might ask, “How are car accident settlements calculated?”

Car accident settlements aren’t determined by a fixed formula, but rather a negotiation process that considers various factors. These include the type and severity of your injuries, the damages you’ve suffered, the insurance policies and other sources of recovery available, and comparative negligence. The skill and experience of the victim’s attorney in negotiating with insurance companies and presenting evidence to support the claim can also influence the settlement amount.

What Are the Types of Damages in a Car Accident Settlement?

Accurately estimating your car accident settlement requires you to be familiar with all the recoverable economic and non-economic damages in your car accident claim. A skilled car accident attorney will evaluate your case to determine what types of damages might be available to you.

Economic Damages

Economic damages (or special damages) are financial losses resulting from the car accident. Examples include lost income, car repair costs, and medical expenses (past and future). It is easy to put a dollar value on these types of damages.

Noneconomic Damages

Noneconomic damages (or general damages) are non-financial losses resulting from a car accident. Common examples include emotional distress, diminished quality of life, and pain and suffering. Putting a dollar value on these damages is difficult, because the losses are subjective.

Punitive Damages

Punitive damages are rarely awarded in car accident cases in Illinois, but when they are, they can be substantial. Unlike economic and noneconomic damages, punitive damages are intended to punish the wrongdoer, and help prevent others from acting similarly.

Calculating Car Accident Settlements

Knowing how to calculate car accident settlements can make you likelier to receive a settlement that covers all your losses and damages. You must identify all losses and expenses you have incurred because of the accident before calculating your settlement. You must then obtain relevant documentation to show that your losses and expenses directly resulted from the car accident. Medical bills, invoices, receipts, pay stubs, and your medical records are some documents you will need when calculating your car accident settlement.

Are There Caps on Damages in Car Accident Cases in Illinois?

There are no caps on damages for personal injuries in Illinois. People who suffer injuries in car accidents in the state are not limited in the amount they can recover in a lawsuit. Over the years, there have been various attempts to cap the amount of pain and suffering damages that injured victims receive, but the Illinois Supreme Court has deemed damage caps to be unconstitutional.

What Factors Are Taken Into Account During the Settlement Calculation Process?

Your car accident lawyer will consider various factors when estimating the value of your injury case. Your attorney will base settlement negotiations on his or her findings. Just some of the factors that may impact your settlement value include:

Injury Severity and Extent

The seriousness and extent of injuries are crucial considerations when calculating car accident settlements. Severe injuries like traumatic brain injuries (TBIs) will require costly and prolonged medical treatment than minor injuries like sprains or strains. Consequently, severe injuries will result in higher settlement amounts than minor ones.

Medical Bills and Lost Income

Medical bills and lost earnings also impact the calculation process. Medical bills include doctor’s fees, hospital charges, medication expenses, physical therapy, and ongoing medical care or treatment. Lost wages include the earnings you have missed and will continue to miss due to job-related injuries.

Available Insurance Coverage

You stand a better chance of getting a reasonable settlement if the at-fault party has adequate insurance coverage. It is hard to get adequate compensation when dealing with an underinsured or uninsured at-fault party. Filing a claim against your own uninsured motorist coverage can help cover your losses, however.


You will receive a full settlement if the other party is 100% liable for the accident. However, your settlement will get reduced in proportion to your share of fault if you were partially at fault for the accident.

Determining the At-Fault Party in a Car Accident

Determining the at-fault party helps answer an important question that weighs on the minds of many injured victims and their families: who pays for medical bills after a car accident? Identifying the at-fault party, however, requires thorough investigation and careful analysis of evidence. The knowledge and skill of a personal injury lawyer are instrumental in this process.

Car accident investigations involve visiting the accident scene, reviewing pictures and videos captured at the scene, and interviewing eyewitnesses. They also involve reviewing your injuries, vehicle damage, and medical records. The police report may also contain evidence crucial in fault determination.

Additionally, accident reconstruction may sometimes be necessary to determine what caused the accident and who was liable.

How Is a Car Accident Settlement Calculated if Both Parties Are at Fault?

The state has a modified comparative negligence law that is applied when both the plaintiff and the defendant share fault for a car accident. If you played a role in causing your crash, the rule states that your award will be reduced in proportion to your percentage of fault.

For example, you may be found 20% responsible for your accident, while the other party is found 80% at fault. If an Illinois jury awards you $200,000 for a car accident injury, and you are 20% liable, your award will be reduced by $40,000. You will be unable to recover damages if you are found to be more than 50% at fault for the car accident.

How Your Attorney Can Help Maximize Your Car Accident Settlement

When you hire an experienced car accident attorney in Illinois, he or she will work to maximize the compensation you receive to ensure your settlement offer is fair and that your losses are fully covered. This includes:

Handling Communications with an Insurance Company

The insurance company will investigate your claim shortly after you file an insurance claim. The company’s adjuster may call you to ask a few questions regarding the accident. Your attorney will advise you on how to handle the adjuster in the event of such a call.

The attorney may, for instance, ask you to provide only basic information about the accident. He or she may also advise you to politely decline to answer the questions and provide the law firm’s contact information to the adjuster. The objective here is to avoid saying something that might hurt your case or give the insurer a better negotiating position.

Protecting Your Rights

Insurance companies will contest your eligibility for compensation by employing any available trick, including violating your rights. They may try to transfer liability for the accident to you, challenge your injury severity, or claim the medical treatment you obtained was unnecessary. Fortunately, working with a lawyer after a car accident will ensure your rights are protected throughout the claim process.

Your lawyer will ensure you do not record any statement that an insurance company may use to justify denying or devaluing your claim. The lawyer will also stop the insurer from deceiving you into signing a request for all your medical records. He or she will ensure the insurer receives only the necessary medical records.

Conducting Independent Investigations

Your attorney has the knowledge and resources to conduct independent investigations. He or she will gather evidence and legal arguments required to show the other party was liable for the accident. Presenting evidence-backed legal arguments during negotiations will increase your chance of getting the best settlement possible.

Determining a Reasonable Settlement

Your attorney will evaluate the damages to which you are entitled in a car settlement. He or she will gather relevant data on medical expenses, lost wages, and pain and suffering from you, your medical providers, and your employer. Your lawyer may also discuss your injuries and your prognosis with your healthcare team to understand more about how your injuries are expected to impact your life.

Negotiating a Fair Settlement

The insurance company will most likely respond to your injury claim with an unreasonably low settlement offer. Your attorney will review the offer with you, and negotiate with the insurer’s representatives for full and fair compensation. Negotiations will continue until your case is settled, or it is resolved through trial.

Representing You in Court

If a fair settlement cannot be agreed upon, your lawyer will bring your case before the courts. He or she will present the evidence in your case in a way that is intended to compel the jury to reach a verdict in your favor.

Contact Our Law Firm to Find Out How Much Your Car Accident Case Is Worth

Contact an injury attorney at our law firm to find out more about how car accident settlements are calculated. During your free, no-obligation case evaluation, our team will provide you with an estimate of how much you can expect to recover if your lawsuit is successful.

Years of Experience: More than 30 years
Illinois Registration Status Active
Bar & Court Admissions: Illinois State Bar Association – 1974-Present
Lake County Bar Association
Illinois Trial Lawyers Association
Lake County Bar Association Civil Trial and Appeals Committee
Federal Bar Association – Northern District of Illinois
Admitted to the Supreme Court of the United States – May 28, 1991
Years of Experience: More than 30 years
Illinois Registration Status Active
Bar & Court Admissions: Illinois State Bar Association – 1974-Present
Lake County Bar Association
Illinois Trial Lawyers Association
Lake County Bar Association Civil Trial and Appeals Committee
Federal Bar Association – Northern District of Illinois
Admitted to the Supreme Court of the United States – May 28, 1991

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