The Differences Between Economic and Non-Economic Damages

If you have been injured because of another party's negligence, the resulting legal claim can feel like a foreign world with its own language. Understanding the types of compensation available is a fundamental step in the personal injury process.

When you're recovering from an accident, a knowledgeable attorney can help you calculate the full extent of your damages—both the obvious and the hidden—which requires a thorough approach to secure fair compensation. Led by Attorney Andrew Antaramian, Antaramian Law, APC, is experienced in helping clients pursue economic and non-economic damages through personal injury claims.

With nearly a decade spent as a defense lawyer for insurance companies, Attorney Andrew Antaramian has a deep understanding of how personal injury claims are handled from both perspectives. This unique background provides him with the insight to help you pursue fair compensation and stand up for your rights.

What Are Economic Damages?

Economic damages are the most straightforward type of compensation in a personal injury case. These damages represent the specific, calculable financial losses you suffer as a direct result of your injury. They are tangible and can be proven with documents such as bills, receipts, and pay stubs. The goal of awarding economic damages is to restore you to the financial position you were in before the accident occurred. 

Medical Expenses 

Medical expenses cover a wide range of treatment-related costs, including initial emergency room visits, hospital stays, and surgeries. They also cover follow-up appointments with specialists, physical therapy, rehabilitation services, and prescriptions or other medications. 

Additionally, medical expenses are not limited to past costs. If your injury requires long-term or ongoing care, you can seek compensation for future medical expenses. This might involve costs for future surgeries, assistive devices like wheelchairs or walkers, home health care, and pain management treatments. Your attorney can work with medical professionals to estimate these future costs and include them in your claim. 

Lost Wages and Loss of Earning Capacity 

Suffering an injury often means time away from work. Economic damages can cover the income you lost during this recovery period. This is calculated based on your wage or salary and the amount of time you were unable to work, as verified by your employer and medical records. 

In more severe cases, your injury may prevent you from returning to your previous job or from working at all. This is known as a loss of earning capacity. Compensation for this loss considers what you would have reasonably been expected to earn over your lifetime had the injury not occurred. Calculating this involves looking at your age, profession, skills, training, and life expectancy. It is a more detailed calculation that often requires the input of financial analysts to determine a fair amount. 

Other Out-of-Pocket Costs 

Apart from medical bills and lost wages, other financial costs can arise from an injury. These can include property damage, such as the cost to repair or replace a vehicle after a car accident. It may also cover the cost of transportation to and from medical appointments. If your injury requires modifications to your home, such as installing ramps or grab bars, these expenses can also be included. Any verifiable cost incurred because of the injury can potentially be part of the economic damages claim. 

What Are Non-Economic Damages? 

While economic damages cover financial losses, non-economic damages address the non-monetary, personal losses that result from your injury. These damages are subjective because they compensate for the human impact of an accident—the suffering that doesn't come with a price tag. Because there are no receipts for pain or emotional distress, calculating these damages is a more subtle process. 

Pain and Suffering 

Pain and suffering compensate you for the physical pain and discomfort you have endured due to your injuries. This includes the pain from the initial injury, subsequent medical treatments, and any chronic pain that may persist long after the accident. The severity and duration of the pain are key factors in determining compensation.

Emotional Distress 

An accident can have a profound psychological impact. Emotional distress damages are meant to compensate for the mental anguish you experience. This can include feelings of fear, anxiety, depression, and humiliation. For some, it may manifest as post-traumatic stress disorder (PTSD), sleep disturbances, or a loss of enjoyment of life. Proving emotional distress often involves testimony from you, your family and friends, and reliable mental health professionals. 

Loss of Consortium 

This type of non-economic damage is unique because it is claimed by the spouse or registered domestic partner of the injured person. A serious injury can fundamentally change a relationship. Loss of consortium compensates the uninjured spouse for the loss of companionship, support, affection, and intimacy that has been taken away as a result of the accident. It acknowledges that the injury's impact extends beyond the individual and affects the family unit. 

California Law Governing Damages 

California law provides a framework for the handling of economic and non-economic damages in personal injury cases. For most personal injury claims, such as those arising from car accidents or slip and falls, there is no cap on the amount of economic or non-economic damages you can receive. The amount is determined by the specific facts of the case and the evidence presented. 

However, in medical malpractice cases, California's Medical Injury Compensation Reform Act (MICRA) caps non-economic damages. As of January 1, 2024, the cap is set at $350,000 for non-death cases and $500,000 for wrongful death cases. This cap increases annually.

It is important to note that this cap applies only to non-economic damages; there is no limit on the amount of economic damages recoverable in a medical malpractice lawsuit. Understanding this distinction is vital before filing a claim against a healthcare provider. 

Contact a Personal Injury Attorney in Los Angeles, California 

Attorney Andrew Antaramian founded Antaramian Law, APC, with a clear purpose: to help people, not large corporations. His time as a defense attorney for insurance companies gave him a first-hand look at how an injury can affect an individual and their family. Now, he dedicates his practice to serving accident victims.

This experience gives him valuable insights into the strategies and evaluation methods used by the opposition in personal injury claims. 

Located in Glendale, California, Antaramian Law, APC, serves clients throughout California. If you or a loved one has been injured, reach out today to schedule a consultation and discuss your case.