Accident Stock photos by Vecteezy

In auto settlements, several types of damages can be covered to compensate the injured party for losses resulting from the accident. These damages generally fall into two categories: economic (measurable financial losses) and non-economic (subjective losses). Here are the main types:

Economic Damages

1. Property Damage
   What It Covers: Costs for repairing or replacing the damaged vehicle, as well as any personal property inside the car.
   Typical Coverage: Includes repair bills, rental car costs while repairs are made, or the car’s market value if it’s totaled.
2. Medical Expenses
   What It Covers: All current and future medical bills related to injuries from the accident, including hospital stays, surgery, medication, physical therapy, and rehabilitation.
   Typical Coverage: Includes initial emergency room visits, follow-up care, specialist consultations, and any ongoing treatments or future medical needs.
3. Lost Wages
   What It Covers: Compensation for income lost due to time away from work while recovering from injuries.
   Typical Coverage: Reimburses wages or salary missed during recovery and may also cover loss of future earning capacity if the injuries permanently limit your ability to work.
4. Rental Car Costs
   What It Covers: Expenses related to renting a car while your vehicle is being repaired or replaced.
   Typical Coverage: Many insurance policies offer rental reimbursement to cover a rental vehicle for a limited time.
5. Out-of-Pocket Expenses
   What It Covers: Additional costs incurred as a result of the accident, such as transportation to medical appointments, child care during recovery, or home modifications if injuries cause disability.
   Typical Coverage: These costs are reimbursed when documented as necessary and directly related to accident-related injuries.

Non-Economic Damages

1. Pain and Suffering
   What It Covers: Compensation for physical pain and emotional distress caused by the accident and resulting injuries.
   Typical Coverage: This subjective damage is usually calculated based on the severity of the injuries and the expected duration of recovery.
2. Emotional Distress
   What It Covers: Includes the psychological impact of the accident, such as anxiety, depression, or PTSD symptoms.
   Typical Coverage: Psychological counseling may also be covered, depending on the extent of mental health impacts from the accident.
3. Loss of Enjoyment of Life
   What It Covers: Damages for a reduced ability to enjoy day-to-day activities, hobbies, and overall quality of life after an accident.
   Typical Coverage: Common in cases involving permanent injuries or long-term limitations affecting personal fulfillment.
4. Loss of Consortium
   What It Covers: Compensation for the negative impact the accident has had on relationships, particularly spousal relationships.
   Typical Coverage: Often involves damages awarded to the spouse or family members for a loss of companionship, support, or intimacy.
5. Disfigurement or Permanent Disability
   What It Covers: Damages for permanent scarring, disfigurement, or lasting disabilities that result from the accident.
   Typical Coverage: Compensation is often based on the physical and emotional impact of the lasting change in appearance or function.

Less Common Damages

1. Punitive Damages
   What It Covers: Intended to punish the at-fault party for gross negligence or reckless behavior, rather than to compensate the injured party.
   Typical Coverage: Rare in auto settlements and generally awarded only if the at-fault driver’s actions were especially egregious, like driving under the influence.

Calculating and Claiming Damages

Each type of damage is typically documented with evidence, such as medical bills, repair estimates, pay stubs, and witness statements. In most cases, economic damages are easier to calculate, while non-economic damages often require negotiation based on the severity of the impact on the injured party’s life.
A fair auto settlement aims to cover all relevant damages to help the injured party recover financially and, where possible, emotionally from the accident’s effects.