Compensation
Accident compensation: what you can claim
Compensation is meant to put you back, as far as money can, where you would have been without the accident. It is built up from separate categories of loss, and each one needs its own evidence.
Most injury claims have two main parts. The first is financial loss you can add up, such as medical bills, lost wages and travel costs. The second is the harm itself: pain, suffering and the effect on your life. Serious claims add future losses, like ongoing care and reduced earning capacity. Your final figure then depends on fault, evidence and the insurance available.
Financial losses you can prove with paperwork
In the US and Canada these are usually called economic damages. In the UK they are special damages. They include:
- Medical and rehabilitation costs: emergency care, specialist visits, scans, physiotherapy, prescriptions and equipment.
- Lost income: wages, overtime, bonuses and self-employed earnings you missed while recovering.
- Out-of-pocket expenses: travel to appointments, parking, childcare and help around the house.
- Property damage: repairs or replacement of your vehicle, phone, clothing or other belongings.
- Care from family or friends: in many places you can claim for help given unpaid by people close to you.
The rule of thumb is simple: if you spent it or lost it because of the accident, keep the receipt, payslip or bank statement.
Pain, suffering and loss of enjoyment
These are non-economic damages in North America and general damages for pain, suffering and loss of amenity in the UK. There is no receipt for them, so they are valued by looking at how serious the injury is, how long it lasts and how it has changed your daily life.
Each country approaches this differently. UK courts use published guidelines that set brackets for different injuries, and road traffic whiplash in England and Wales has a fixed tariff. In Canada, the Supreme Court of Canada has set an upper limit on pain-and-suffering awards, adjusted for inflation, and Ontario car accident claims also face a threshold and a deductible. In the US there is no national scale, and some states cap non-economic damages in certain kinds of case.
Future losses
For injuries that don't fully heal, the future part of a claim is often the largest. It can include future care costs, ongoing treatment, adaptations to your home, and future earning capacity if you can't go back to the same work. These are usually proved through medical and financial experts, and the total is adjusted to present value because you receive the money now rather than over the years.
Other kinds of damages
A spouse or partner may have a claim for loss of consortium in the US. Families can claim wrongful death damages after a fatal accident, under rules that differ by state, province and country. Punitive damages, meant to punish very bad conduct, are rare in accident cases and almost unknown in UK personal injury claims.
What can reduce your compensation
- Shared fault. If you were partly to blame, most places reduce your award by your share. See comparative vs contributory negligence.
- Not mitigating your loss. Skipping treatment or refusing suitable work can lower the award. See mitigation of damages.
- Policy limits. An insurer rarely pays more than the at-fault party's coverage, even if your losses are higher.
- Repayments. Health insurers, benefit agencies and in the UK the Compensation Recovery Unit may be entitled to recover some of what they paid you.
- Fees and costs. What you take home depends on your fee agreement. Ask about this at the start.
Work out what your claim includes
How much is my accident claim worth?
How insurers and lawyers actually put a figure on a claim.
Claim value workbook
List your losses category by category, with the evidence for each.
Economic vs non-economic damages
The two halves of most injury claims, side by side.
General vs special damages
The UK terms, and how they line up with the US ones.
Settlement vs trial
How the route you take affects the amount and the risk.
Pain and suffering
How the non-financial part of a claim is valued.
Housekeeping loss
Claiming for chores and home tasks you can no longer do.
Structured settlement
Being paid over time instead of in one lump sum.
All compensation terms
Every damages term explained in plain English.
Common questions
How is pain and suffering calculated?
There is no single formula. It depends on how serious the injury is, how long it lasts and how it affects your life. UK courts use published guideline brackets, while US and Canadian insurers look at medical records, similar cases and, in some places, legal caps or thresholds.
Can I claim for lost wages if I'm self-employed?
Yes. You'll usually need tax returns, invoices, bank statements and accounts from before and after the accident to show what you would have earned. An accountant's report can help in larger claims.
Is accident compensation taxable?
Compensation for personal injury is generally not taxed as income in the US, UK or Canada, but parts of a settlement, such as interest or punitive damages in the US, may be treated differently. Check with a tax adviser if your settlement is large.
Can I still get compensation if I was partly at fault?
In most places, yes, but your award is reduced by your share of the blame. A few US states still bar recovery if you were even slightly at fault, and some bar it if you were mostly at fault.