How is a Texas Car Accident Settlement Calculated?

If you or a loved one sustain injuries or property damage after a vehicle accident caused by the actions of another driver, you will likely be able to recover various types of compensation for your losses. This includes coverage of medical expenses, property damage losses, rental vehicle coverage, lost wage recovery, and more. However, it can be confusing to understand how car accident settlements are calculated, particularly when you start the negotiation process with the insurance carrier. A car accident attorney in Houston can help you understand your legal and financial standing after a wreck.

The Insurance Carrier Is Looking Out For Themselves, Not You

One of the most important things we want you to remember after an accident is that insurance companies are not on your side. Even your own insurance carrier will look out for their interests, not yours.

We discuss this in a page about how car accident settlements are calculated because individuals often need compensation right away after an incident occurs. This can lead to the temptation to accept an early settlement offer from the insurance carriers, but the initial offer will likely be far below what crash victims should receive for the incident.

It is imperative to have a general understanding of how accident claims are calculated before thinking about accepting a settlement from the insurance carrier. If you have any questions about your particular case or if you feel you are being treated unfairly by an insurance carrier after a Texas car accident, we encourage you to reach out to an attorney for assistance as soon as possible.

Calculating Your Settlement

Any online calculator you may have stumbled upon to help determine how much compensation you should receive for your car accident is likely no different than the calculator on your computer desktop. There are simply too many factors related to each specific Texas vehicle accident claim to say, “This is how much compensation you will receive.”

Every claim is different and deserving of an independent investigation and calculation of economic and non-economic damages.

Calculating economic damages after a vehicle accident involves gathering calculable expenses that have occurred as a result of the incident. By using receipts, bills, invoices, or estimates, injury victims and their legal team can help adequately calculate:

• Emergency and ongoing medical bills
• Any out-of-pocket expenses are rising due to the incident
• Property damage expenses
• Lost wages if a crash victim cannot work

Calculating non-economic damages after a vehicle accident is more challenging and will be especially important if the claim goes to trial. Non-economic losses are not as easily quantifiable as the economic damages previously mentioned, but they are equally as important. These types of losses revolve around a victim’s:

• Physical pain and suffering
• Emotional and psychological distress
• Loss of quality of life

There are a few methods available for calculating non-economic damages, including the “multiplier method.” Using this method, an attorney will add up all of the economic damages their clients sustained and then multiply this by a set number, usually a number ranging from 1.5 to 5. For example, if an individual sustains $200,000 worth of economic damages, an attorney could use a multiplier of “three” to reach a non-economic damage total of $600,000, leading to an overall demand of $800,000 from the insurance carrier or at-fault party.