How to Calculate a Rear End Car Accident Settlement

How to Calculate a Rear End Car Accident Settlement

Car accidents often bring on a flurry of firsts. If you’ve never been involved in a rear end collision before, you’re likely wondering what to expect after being rear ended. You’re not sure where to get medical treatment after the crash, or where to get the damage to your car fixed. And you’re probably wondering how you’ll pay for all this, and wondering how to calculate a rear end car accident settlement.

Most car insurance companies use a formula to arrive at a financial damages starting point for a rear end collision settlement. You can use a rear end accident settlement calculator online to get your own figure. 

Auto insurance companies typically use a multiplier of your medical costs to get an estimate of your non-economic damages, which includes compensation for your pain and suffering. This amount is added to your economic damages, including medical costs, damages to property and lost earnings. Added together, this figure from the settlement calculator offers a starting point for settlement negotiations. 

First Steps

As the dust begins to settle and your accident is becoming less of an immediate threat to your safety, it’s a good idea to understand the legal context of your options moving forward. Much has been written about the procedures at the scene of the accident, but there’s not as much information out there about handling the aftermath. Most importantly, what steps need to be taken to ensure a fair rear end car accident settlement.

Before you begin exploring your legal options, be sure you’ve taken responsible steps at the scene of the accident. Calling the police, reporting the accident, taking pictures, and seeking medical advice should always precede any attempted resolution of the incident.

Once you’ve left the scene of the auto accident, you can begin fully exploring your options. While you may wish to report the incident to your insurance company first thing, it may be worth speaking to a car accident lawyer before making the call.

Generally speaking, if your collision required a visit to the doctor’s office or the emergency room, it’s a good idea to prioritize a call to a local car accident lawyer. Most personal injury attorneys offer free consultations to prospective clients. They will be able to give you valuable insight and guidance about filing your claim, getting medical treatment and more, even if you opt not to hire them.

Collecting Information

In some rear end crashes you may wish to begin the car accident settlement process without an attorney. If fault is very clear and you want to see what the insurance company is offering, you might want to try writing a rear end car accident settlement demand letter, and you man get an initial offer that you’re very happy with. In many other settlement negotiations, you will want to continue to negotiate a better rear end collision settlement

Before you sit down to calculate your damages, be sure to collect any and all paperwork you’ve accumulated since the wreck. Doctor’s bills, prescription receipts, invoices from the body shop and estimated future medical expenses can all help you understand the value of your claim. If you missed work because of your injuries, you can also include the wages you missed out on when tallying up your damages.

Even if you don’t have documentation of every dollar spent in dealing with the accident, a rough estimate can be used for the rear end accident calculator. The more precise you are with your numbers, the more accurate the results will be, but even a ballpark figure of your damages can help you calculate the value of your accident claim.

Finally, consider how serious your injuries are and how long you believe they will impact your life. For instance, a spinal cord injury can leave a car accident victim paralyzed for life. Serious, long-lasting, catastrophic injuries like this can act like a multiplier to your financial damages. If you’re not sure about your long-term prognosis, don’t worry about factoring the future into your calculations.

Calculating Your Rear End Collision Settlement

Once you’ve gathered all the data about your medical expenses, property damages, lost earnings and anticipated medical expenses for the future, it’s time to calculate your estimated settlement amount for the rear end collision. It’s important to keep the word estimate in mind – the figure may be far different from the settlement offer or check you may ultimately receive from the insurance company. Instead, it’s helpful to look at your estimated settlement amount as a general starting point for negotiations with the at-fault driver and their insurer.

Formula For Calculating A Rear End Car Accident Settlement:

1. Medical Bills: Take all your current medical expenses and add that number to the amount of expected future medical expenses you anticipate. This is your medical bills number.
2. Property Damage: Take the estimate to fix your car (and any valuable property that may have also been damaged in the crash), as well as any car rental fees, and add those together. This is your property damage number.
3. Lost Wages: Using your per day average income, estimate how many days you’ll be out of work and how much income you’re giving up on in those days. This is your lost income number.
4. Pain & Suffering Multiple: On a scale of 1-5, REALISTICALLY estimate how much this is affecting your day to day life, and for how long it’s expected to have an impact. If you only suffered minor cuts and bruises that didn’t have much impact on your day to day life, first consider yourself very lucky, then go ahead and give yourself a “1”. If you suffered life altering injuries like losing a limb or the ability to walk because you were rear ended on a motorcycle, you’re in 5 territory. Most rear end collisions fall somewhere in the middle of those two with injuries like whiplash and herniated discs.

Rear End Collision Settlement Calculator Example

A rear end collision settlement calculator might look like this: 

1. Medical costs (total of medical bills even if you did not pay out of pocket): _________________
2. Property damages (Vehicle damage in the rear end accident):______________
3. Lost earnings(If you have missed work time because of accident injuries, enter the sum of your lost income. Also factor in PTO you had to take):_________________
4. Future lost earnings(If you will miss work because of your injuries and or ongoing treatments, enter an estimate here): ______________
5. Estimated future medical costs (If you need ongoing medical treatment for your injuries, enter them here): __________________
6. Multiplier for general damages (Used to estimate your pain and suffering – choose a number between 1.5 and 5, keeping in mind that only very serious injuries with months or years of recovery will qualify for a 4 or 5): ____________
7. Economic damages (Sum of special damages, or economic losses):__________________
8. Non-economic damages (pain and suffering damages based on the multiplier selected):_________________
9. Total Settlement Estimate:______________________

See actual rear end car accident settlement amounts here

How to Calculate a Rear End Car Accident Settlement – Final Thoughts

In most rear end collision accidents, you have economic and non-economic damages. Economic damages are also called “special damages.” These are easy to obtain a value for: medical treatment bills, lost earnings and property damage. All you need to determine these is have your invoices or bills, and a calculator, and add them up. 

Non-economic or general damages are what you may get for pain and suffering, which can include physical discomfort, mental anxiety and stress and the effect the injuries have on your life. Putting a fixed dollar amount on these damages is difficult. As the accident victim, you will want to use a bigger multiplier. The insurance company wants to use a lower number. 

The multiplier that is used in the end depends on several things: How bad are your injuries? How many medical treatments have you had? How many medical treatments will you need now and later on? Are your injuries long term or permanent? How much have your accident injuries affected your life? 

Online Car Accident Settlement Calculators:

There are a number of car accident settlement calculators available online that can do the math for you – most use some variation of this formula. It’s important to know that every rear end car accident is different, so the factors that go into the settlement, and as a result the settlement itself will be different. Each individual car accident settlement will be based on the facts of the case, the earning/employment status of the victim, and the severity of the injuries.

While these tools are a great starting point, which will give you a rough idea about how much your rear end settlement might be, the most accurate calculation will be done by an attorney. There are nuances and details that only a personal injury attorney with knowledge of the specific car accident laws, insurance policy limits, and other factors in your state can give you. That experience simply can’t be built into an online car accident settlement calculator.

Many personal injury lawyers work on contingency, which means that no payment is due unless they recover a settlement on your behalf. While legal fees can be costly, initial consultations are usually free, do not form an attorney client relationship, and most lawyers will give you a pretty good rough estimate of how to calculate your rear end accident settlement.