When lawyers talk about "damages," they mean the money you're entitled to because of your injury. There are several categories, and knowing what falls into each one helps you understand the value of your personal injury case.
Economic Damages
These are measurable financial losses. Medical bills (past and future), lost wages, reduced earning capacity, property damage, prescription costs, physical therapy, medical equipment, and home modification costs if the injury requires accessibility changes.
Economic damages are calculated based on actual numbers. For future losses, experts such as economists and vocational specialists project what you'll spend on treatment and how much income you'll lose. This is particularly relevant in spinal cord injury and traumatic brain injury cases where long term care is needed.
Non-Economic Damages
These cover the things that don't come with a receipt. Pain and suffering, emotional distress, loss of enjoyment of life, loss of consortium, anxiety, depression, scarring, and disfigurement.
There's no standard formula for calculating non-economic damages in New Jersey. Some attorneys use a multiplier, others use a per diem approach. Insurance companies have their own software that generates a range. The actual number is whatever a jury would award or both sides agree to in settlement. The Insurance Information Institute publishes useful background on how insurers approach claim valuation.
Punitive Damages
New Jersey allows punitive damages where the defendant's conduct was especially egregious: drunk driving, intentional harm, or a company knowingly selling a dangerous defective product. They're relatively rare and require clear and convincing evidence.