Economic vs Non Economic Damages: What’s the Difference?

When you sustain an injury as a result of someone else’s negligence or misconduct, the repercussions can reverberate through every facet of your existence. From enduring physical pain and emotional distress to grappling with the financial strain of medical expenses and income loss, the aftermath of an accident can be profoundly challenging. If you plan to file a personal injury claim against the person who harmed you, you might wonder about the difference between economic vs non-economic damages.

At Mueller Schmidt Mulholland & Cooling, our Omaha personal injury lawyers empathize with the overwhelming stress and uncertainty that people experience after a severe injury. With over 56 years of experience, our compassionate attorneys have steadfastly advocated for accident victims in Nebraska, pursuing the compensation they deserve.

What Are Economic Damages?

Economic damages are compensation for the tangible, quantifiable losses that result from an injury. These expenses come with a specific monetary value. Some common examples of economic damages include money for:

• Medical expenses: Emergency room, hospital, office visit, medications, and surgery charges
• Lost wages: Money you missed when you were off work for your injury
• Loss of earning capacity: If you suffered a permanent impairment and can’t return to a job that paid as much as your pre-injury wages, you can claim that money
• Property damage: Repair or replacement of anything damaged in the accident
• Out-of-pocket expenses: Travel expenses for medical care or help at home

To substantiate economic damages, you must furnish documentation such as medical bills, pay stubs, tax returns, and receipts. An experienced personal injury attorney can assist you in collecting this evidence and computing the complete scope of your financial losses.

What Are Non-Economic Damages?

What are non-economic damages? Non-economic damages are compensation for the intangible losses that result from an injury. The amount of economic damages is subjective, as non-monetary harms are difficult to quantify. This is despite having a profound impact on your life. Some common non-economic damages examples include money for:

• Pain and Suffering: This encompasses the physical discomfort, emotional anguish, and mental anguish and distress you experience as a result of your injuries.
• Emotional Distress: Serious injuries can exact a profound toll on your mental well-being, potentially giving rise to conditions like anxiety, depression, post-traumatic stress disorder (PTSD), and sleep disturbances.
• Loss of Enjoyment of Life: If your injuries hinder your ability to engage in activities and hobbies that once brought you joy and fulfillment, you have the right to pursue damages for this loss of pleasure and enjoyment.
• Loss of Consortium: If your injuries hurt your relationship with your spouse or partner, such as a loss of companionship, affection, or intimacy, your spouse can seek damages for this loss of consortium.
• Disfigurement and Scarring: If your injuries leave you with permanent scars, disfigurement, or other visible changes to your appearance, you can seek compensation for the emotional distress and self-consciousness this causes.

Unlike economic losses, non-economic losses are subjective and have no ready-made price tag. Their value can vary widely depending on the individual circumstances of your case. Factors that may influence the amount of non-economic damages you receive include:

• The severity and permanence of your injuries
• The impact on your daily life and relationships
• Your age and overall health before the accident
• The strength of your evidence and testimony
• The skill and experience of your personal injury attorney

Facts About Damages vs. Non-Economic Damages

Economic damages vs. non-economic damages: what should you know? Additional information you need to know about damages includes the following:

• Proving Damages:  Nebraska bases economic damages on tangible financial losses, which are generally easier to prove than non-economic damages. You can provide bills, receipts, and other documentation to support your claim for economic damages. Non-economic losses, however, rely more heavily on testimony from you, your loved ones, psychological treatment records, and expert witnesses to establish the extent of your intangible losses.
• Calculating Non-Economic Damages: To calculate non-economic damages, insurers, lawyers, and courts typically use one of two methods. With the multiplier method, all the economic losses are totaled. That total will be multiplied by a factor between 1.5 and five to determine the value of your non-economic damages. The more severe your injuries, the nearer to five the factor will be. In the per diem method, a number is chosen that represents your pain levels. Often, the number chosen is your usual daily wage. That number is multiplied by the number of days you experience pain after the accident to determine your non-economic damages. You can check the modified comparative negligence in personal injury claims as a way to calculate how much damages you can get.
• Taxation: According to the IRS, personal injury settlements or awards are not usually taxable. There are some exceptions, so you should talk with your attorney to learn whether you’ll owe taxes.

It’s crucial to recognize that each personal injury case is distinct, and the damages accessible to you hinge on the particulars of your circumstances. An adept attorney can assess your case comprehensively, elucidating the complete value of your claim, encompassing both economic and non-economic damages.

Punitive Damages: A Third Type of Damages

In addition to compensatory damages (economic and non-economic), you may be eligible to request punitive damages when your case goes to court. Its aim is to punish the defendant as a way of warning the offending party to avoid doing the same harmful actions.

In Nebraska, punitive damages are only available in limited circumstances, such as when the defendant’s actions were willful, wanton, or fraudulent. There must be clear and convincing evidence that the defendant acted with the intent to harm or with reckless disregard for the safety of others.

It is important to note that punitive damages are subject to certain limitations and procedural requirements in Nebraska. For example, you must specifically request punitive damages in your complaint, and the court may bifurcate the trial into separate phases for determining liability and punitive damages. An award of punitive damages cannot exceed the compensatory damages that were awarded. An attorney well-versed in Nebraska personal injury law can advise you on whether punitive damages may be available in your case and how to pursue them.

Contact Mueller Schmidt Mulholland & Cooling for Help with Your Personal Injury Claim

Damages may be awarded for the personal injury claims based on losses you incurred. If you or a cherished family member have endured injuries stemming from another individual’s negligence or misconduct, you may be eligible to receive substantial compensation to address both your economic losses and non-economic hardships. Nonetheless, navigating a personal injury claim independently can be daunting, particularly amidst the physical, emotional, and financial repercussions of an accident.

If you have questions about economic vs. non-economic damages or any other aspect of your personal injury claim, do not hesitate to contact Mueller Schmidt Mulholland & Cooling today at 402-999-9000 or contact us online to schedule your free consultation. Our firm serves clients throughout Nebraska and offer flexible scheduling and virtual meeting options for your convenience. Consequently, you do not have to handle this difficult time alone – let our team of lawyers fight for you.

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