What Are Compensatory and Punitive Damages - Adamson Ahdoot

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What’s The Difference Between Compensatory Damages and Punitive Damages?

January 30, 2023 Alan Ahdoot
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Getting involved in an accident entitles you to compensation for the injuries and economic damages sustained. Aside from reimbursing your medical expenses, the at-fault party may also have to compensate you for lost wages and property damage. Whatever your personal injury case is, two types of damages may be awarded to you: compensatory and punitive damages.

But what differentiates them from each other? If you have recently been injured in an accident, and want to learn more about your possible settlement options, you are in the right place. Read on to find out the difference between compensatory and punitive damages.

What are Punitive Damages?

Punitive damages, also called exemplary damages, are paid by the at-fault party when compensatory damages are found to be insufficient.

These damages are meant to punish the individual whose conduct is considered intentional or grossly negligent, and as a means of deterring others from committing the same acts.

Here are some examples of cases that may be eligible for punitive damages:

Medical Malpractice

If a healthcare provider fails to uphold righteousness while taking care of a patient, the act of negligence could lead to serious complications or wrongful death. The victims of this kind of wrongdoing have the right to compensate for the pain and suffering incurred.

Product Liability

A classic example of this is if a company is well-aware that they are selling a defective product, but still chooses to profit from it without considering how dangerous it could be for its customers. 

If they are proven negligent in their decision to sell these products, then the court could order them to pay punitive damages.

Drunk Driving

Driving under the influence suggests that the defendant made a conscious decision to engage in reckless behavior that harmed another person. Punitive damages aim to deter the driver and other drivers from doing the same thing in the future.

How Do You Qualify for Punitive Damage Compensation?

Qualifying for punitive damages requires proof of malice, oppression, or fraud. For instance, you will need to provide enough evidence to prove that the at-fault party’s behavior was egregious or that they lied to conceal facts. 

You should also show proof that the other individual was willfully indifferent to your well-being or grossly negligent.

What are Compensatory Damages?

Compensatory damages are money awarded to the plaintiff in a lawsuit. Unlike punitive damages, these are typically given to the injured victim to pay for medical expenses and other damages incurred. 

Here are some examples of cases that constitute compensatory damages:

Car Accidents

The purpose of compensatory damages is to put a monetary value on each aspect you’ve lost or suffered from. 

In the case of a car accident, these include the damage to your car and the cost of repairing your vehicle. It also covers compensation for the pain and suffering you endured, depending on the physical injuries sustained.

Workplace Injury

If you suffered an injury at work, you have the right to seek compensation or disability benefits from your employer. 

Depending on the severity of the injury, you qualify for compensation for all medical expenses to diagnose and treat your condition. On top of that, you can also receive compensation from your company for lost wages and the inconvenience caused.

Premises Liability

Suffering injuries while on another person’s property means you may be liable to receive compensation. This would happen as long as, the owner allowed you to enter the property. 

In a premise liability case, the owner may compensate you for your medical expenses, lost wages, and pain or suffering.

Types of Compensatory Damages

To fully understand its scope, let’s look at the two types of compensatory damages.

a nurse measuring the blood pressure of a patient
Knowing the difference between compensatory and punitive damages ensures you get the compensation you deserve.

Actual Compensatory Damages

Actual compensatory damages cover the monetary amount that will pay for the loss, and nothing more. They provide for injuries, damages, or other incurred losses. 

Examples of actual compensatory damages include the following:

  • Medical and hospital bills, including treatments and therapy sessions
  • Rehabilitation expenses
  • Medicine and prescription drugs
  • Nursing home care
  • Domestic services
  • Medical equipment
  • Lost wages or lost employment income
  • Increased living expenses
  • Property replacement or repair
  • Transportation

General Compensatory Damages

General compensatory damages refer to estimates of loss that don’t involve actual monetary amounts. Certain civil courts use the “multiplier method,” which calculates the damages by multiplying the total of actual damages by the number that signifies the injury’s severity.

Examples of general compensatory damages include the following:

  • Mental anguish
  • Emotional distress
  • Temporary or long-term physical pain and suffering
  • Disfigurement
  • Future medical expenses
  • Future lost wages
  • Loss of consortium
  • Inconvenience
  • Loss of enjoyment of life
  • Loss of opportunity

Compensatory Damages Vs. Punitive Damages 

While both seem the same, there are things that differentiate compensatory vs. punitive damages. 

In California, compensatory damages refer to what the at-fault party pays to compensate the victim for economical and non-economical losses. Meanwhile, punitive damages seek to punish the defendant and discourage others from committing the same acts. 

Contrary to compensatory damages, punitive damages apply in cases where the at-fault party knowingly acted without considering the safety and well-being of others. Such cases might include:

  • Intentional harm to the victim
  • Seriously injured
  • Negligence in medical malpractice claims 
  • Cases where the guilty party engaged in malicious activity

Seek a Personal Injury Attorney at Adamson Ahdoot

If you or a loved one has recently suffered from an accident due to another person or company’s negligence, we are here to help. At Adamson Ahdoot, we fight for your right to receive the compensation you deserve. We’re a full-service civil litigation firm with over 100 years of combined legal experience handling personal injury cases.

Call us at (800) 310-1606 today to schedule your free consultation with a premier injury attorney. We serve a diverse clientele and can conduct consultations in English or Spanish.

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