How are Personal Injury Damages Calculated?

For injured people who have a viable personal injury claim to pursue, it is a reasonable and common for them to ask about how their damages are calculated.  

What Damages can be Recovered?

Firstly, it is important to identify the various heads of damage that can be claimed for.  The damages that can be claimed in a personal injury claim are governed by the legislation and case law.  The main heads of damage that can be pursued in personal injury claims include: 

1. Special Damages – i.e. any out of pocket expenses or refunds owing to Government bodies or other entities.
2. General Damages – i.e. compensation for pain, suffering, and loss of enjoyment of life. 
3. Past Economic Loss
4. Past Loss of Superannuation Entitlements
5. Future Economic Loss
6. Future Loss of Superannuation Entitlements
7. Past Gratuitous Care and Assistance
8. Future Care and Services
9. Future Medical Treatment
10. Future Out of Pocket Expenses

It is important to note that the above list is not exhaustive and there may be other heads of damage that could be pursued, however, most damages will fall within the above categories.  

How are the Damages Calculated?

The theory behind damages is to, as best as possible, place the injured person in the same financial position that they would have been in had they not been injured.  With this in mind, the above damages can be calculated as follows:

1. Special Damages – Any out of pocket expenses and any applicable refunds to Medicare, WorkCover Queensland, private health funds, or any other entity would be itemised.  
2. General Damages – This head of damage is regulated by legislation and is calculated by reference to an Injury Scale Value (ISV).  An ISV of between 0 and 100 is assigned to the injury based on the nature and extent of the injury.  This is done with reference to either the Civil Liability Regulation or the Workers’ Compensation and Rehabilitation Regulation, depending on the type of claim.  Each ISV is assigned a monetary value which progressively increases to the highest injuries with an ISV of 100.  Unfortunately, this head of damage does not necessarily take into account the individuals pain experiences or the types of activities that the injured person can no longer perform.  This is often what people feel that they deserve to be compensated for the most.  
3. Past Economic Loss – The notional income that the claimant would have received from the date of the accident to present is calculated, and any income that they have earned through personal exertion during the same period is deducted to identify their loss.
4. Past Loss of Superannuation Entitlements – The applicable superannuation rate for the period of loss is used for the amount claimed for past economic loss.
5. Future Economic Loss – Calculated either mathematically, i.e. an ongoing weekly loss calculated into the future, or on a global basis if the loss is unable to be calculated mathematically.
6. Future Loss of Superannuation Entitlements – Calculated at the applicable superannuation rate for the amount claimed for future economic loss.
7. Past Gratuitous Care and Assistance – The commercial rate of care and assistance may be claimed for care provided gratuitously by friends or family.  The care must be provided for 6 hours per week for a period of 26 weeks to be entitled to claim this head of damage, however, this head of damage is not available to workers’ compensation claims.
8. Future Care and Services – The commercial rate of care and assistance can be claimed for recommended care and services into the future.
9. Future Medical Treatment – Any future rehabilitation, treatment, surgery, etc which may be required into the future as a result of the injuries.
10. Future Out of Pocket Expenses – Any other out of pocket expenses can be claimed for items such as medication, travel, aids/equipment, etc.  

Due to the nature of the calculations, it is impossible to calculate an injured person’s damages with absolute certainty.  This is because a significant portion of the damages often relates to future losses which involve varying degrees of speculation and uncertainty.  As a result, there are a number of potential outcomes and calculations which could result in large variances in damages calculations.  The most basic example of this is the fact that not everyone is guaranteed to live to normal retirement age and/or be in excellent physical health at that age due to natural causes.  Therefore, an award for future economic loss is likely to take these risks into account.

It is important to note that the above examples of heads of damages and their calculations are very general in nature.  For any personal injury claim, the amount claimed is very specific to the individual’s circumstances.  The type of the claim can also vary the damages that can be claimed and it is therefore imperative to seek advice from experienced personal injury lawyers who will be able to help maximise your damages claim.