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Compensatory Damages

Definition - What does Compensatory Damages mean?

Compensatory damages are payments awarded for a personal injury lawsuit for actual losses, including pain and suffering, medical expenses, and wage loss compensation. Compensatory damages do not include punitive damages, which are not calculated from actual loss but with the intention of punishing the defendant and deterring them from committing dangerous activities.

Purpose of compensatory damages

Most personal injury awards will only include compensatory damages. Compensatory damages are awarded to the plaintiff in an injury case to replace what was lost and to restore them to their original position.

Many states do not allow any other damage awards for personal injury claims except compensatory damages. Other states, however, will allow punitive damages if the court determines the actions of the defendant were due to gross negligence and/or willful, wanton or reckless acts.

Types of compensatory damages

Compensatory damages may be paid for past, present and all future medical expenses which the court deems reasonable to help the victim recover from their injury and to restored them to their previous condition. Awards of future medical compensation often include expected nursing and institutional care.

Victims of a personal injury case may also be compensated for their loss of earning capacity. The amount awarded for wage loss compensation is based on the age, skill, training, experience and industry of the plaintiff. This can include payment for current wage loss as well as future wage loss.

Additional compensatory damages include payment for disfigurement which results in scaring, dismemberment or changes in the plaintiff's physical appearance, as well as loss of consortium, which allows compensation for any reduction in quality and nature of the marital relationship.

Finally, compensatory damages can also include pain and suffering which was caused by the injury. Pain and suffering can be mental or physical and can include all current and future issues such as nervous shock, anxiety, embarrassment and mental anguish.

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