Two Ways to Calculate a Pain and Suffering Settlement

In any personal injury case, there are two main categories of "damages" available to the injured person ("damages" is just a term for the different losses the at-fault party must compensate you for). These are your economic or "special" damages, and your non-economic or "general" damages.

Special damages include most of the easily calculable losses resulting from your accident or injury—your medical bills, your lost income because of time missed at work, your property damage, and any other out-of-pocket losses.

General damages include things like pain and suffering, which means discomfort and physical pain, but also emotional distress, anxiety, and mental anguish that's linked to the accident and your injuries.

In the rare event that a personal injury case makes it all the way to a court trial, the compensation awarded to a winning plaintiff is based on these types of damages. That's one reason why an injury settlement reached out of court is based on similar factors. But how do you put a dollar value on your pain?

Quantifying Pain And Suffering

It's not easy to pin a dollar amount on general damages. But there are a number of approaches that insurance adjusters take when calculating pain and suffering as part of an injury settlement. The two most common are the multiplier method and the "per diem" (daily rate) method. Try out the calculator below to compare both methods.

The "Multiplier" Method of Calculating Pain and Suffering

The most common approach is to add up your accident-related medical bills and multiply those by a number between 1.5 on the low end, and 4 or 5 on the high end.

This second number (called a "multiplier") will depend on several key factors related to your case, including:

• the seriousness of your injuries
• your prospects for a quick and complete recovery
• the impact of your injuries on your day-to-day-life, and
• whether or not the other party was clearly at fault for the underlying accident.

The multiplier method is used in AllLaw's Injury Settlement Calculator, because it's believed to be the method most frequently used by insurance companies. The sticking point in injury settlement negotiations is going to be the number used to represent the multiplier—you're going to argue for a higher number, while the defendant (or more specifically their insurer) will push for a lower one. See this list of factors to help you determine the right multiplier to apply to your case.

Using a Daily Rate to Value Pain and Suffering

Another approach to calculating pain and suffering is called the "per diem" method. "Per diem" is Latin for "per day," and the idea is to demand a certain dollar amount for every day you've had to live with the pain, discomfort, and disruption caused by your accident.

The slippery part of this approach is justifying the daily rate you use. One approach is to use your actual, daily earnings or income. The argument here is that having to deal with the pain caused by your injuries every day is at least comparable to the effort of going to work.

Let's illustrate the "per diem" method with an example. Imagine you were rear-ended and suffered moderate whiplash-type injuries. You're forced to wear a neck brace and take pain medication for two months. You continue to suffer pain for another three months, for a total of five months (roughly 150 days) of pain and discomfort. At your current or most recent job, you earn $45,000 per year—that's $180 per day when you divide your salary by 250 working days per year.

To get to a pain and suffering number in this case, just multiply your $180 daily rate by 150 days of pain, and you arrive at $27,000.

This method obviously can't be used if you're unemployed, and it's not optimal if your income is unusually low or high. The per diem method also starts to falls apart with permanent or long-term injuries, but you'll usually want a lawyer if you're facing those kinds of injuries, and they'll know how to put the right value on your case.

Use Both Methods and Adjust For Claim Specifics

It's always a good idea to use both methods to start, and then adjust your demand from within that range. You may get wildly different numbers, and that's okay—it all boils down to a negotiation dance at the end. If you were hit by a drunk driver who ran a red light and have a bunch of medical bills, start on the higher end of your settlement range. If you slipped on ice or snow in front of a private residence, and liability isn't so clear, your settlement will likely end up closer to the lower end. Every case is unique, but the idea is that you want to start with a reasonable number that you can justify in your demand letter.

Document Your Pain In Your Medical Records

When it comes to general damages, when you're receiving medical treatment, it's important to be very thorough in your communication with doctors, specialists, and other health care professionals. Be sure to report and describe any pain and discomfort you're experiencing, and how it's affecting your life.

An insurance adjuster will often accept your report of pain and discomfort as true when the doctor writes it down and it becomes part of your medical records, but the same adjuster may well question reports of pain and discomfort that come only from you, with no medical records to back them up. Your attorney should be able to help you put together your best possible case given the evidence you have available. Get tips on finding the right injury lawyer for you and your case.