When negotiating a claim, the at-fault party’s insurance adjuster will determine the sum of all medical expenses resulting from the accident, which are known as medical special damages, or special damages. To determine the settlement offer amount for pain and suffering, emotional damages, and permanent disabilities (general damages), the adjuster will multiply the amount of special damages by roughly one and a half to three in situations where the injuries are minor. When the injuries are more severe and painful, the adjuster will multiply the amount by five or more in addition to lost income. In most settlements, that total becomes the starting point for negotiations.
Once the starting point for negotiations is established, additional facts about the accident and the injuries it caused will be revealed that will change the settlement amount. Since the multiplier can range from one and a half to five, there is a wide value range that can result from the damage formula.