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The Difference Between Compensatory and Punitive Damages

The Difference Between Compensatory and Punitive Damages

Accidents caused by another person’s negligence may mean you are entitled to compensation for damages. To collect such damages, you will need to file a personal injury claim. Your compensation is not automatic after you do this — the defendant’s insurance company will have to review your claim to determine what damages you are entitled to. As such, you can recover compensation for two types of damages: compensatory or punitive. Here are the differences between compensatory and punitive damages.

What Are Compensatory Damages?

Compensatory damages are calculated when the insurance company totals the cost of the accident. This type of compensation is created to give back for both injuries and damages sustained by you during your accident. For example, if you were involved in a car accident where your car was damaged and you received injuries, such as a broken bone. Sustaining these types of injuries can lead to being unable to work for several weeks while you recover. If this was the case, you would be compensated for property damage, medical expenses, as well as lost wages.

What Are Punitive Damages?

While compensatory damages are used for compensating the victim, punitive damages are different. These types of damages are rewarded as a punishment for the defendant. Punitive damages are meant to push the defendant to refrain from acting again in the same reckless manner as they did when the accident occurred. When the court decides that the compensatory damages are not enough, they can award punitive damages as well. This happens when the compensatory damages do not fully compensate the plaintiff for his or her physical damage or pain and suffering. 

Main Compensatory and Punitive Damage Differences

One of the main differences between compensatory damages and punitive damages is that they are directed at different parties. Punitive damages can be rewarded in several personal injury cases, but they are most common when the defendant has been grossly negligent. Some other common cases regarding punitive damages include: 

Simply put, compensatory damages are rewarded to benefit the plaintiff while punitive damages are rewarded to punish the defendant. 

Are You Owed Compensation for Damages?

If you have fallen victim to an accident caused by negligence, let our lawyers fight to gain you justice. At Lanzotti & Rau, our lawyers will help guide you in the right direction to win the compensation you deserve for your injuries and damages as a result of your accident. The experienced and compassionate lawyers here at Lanzotti & Rau are here to answer any questions you may have. For your free case evaluation, call us today at 573-335-9300.