Updated June 17, 2026
See your own number
Plug your medical bills and injury severity into the calculator behind this framework.
The formula insurers and plaintiff attorneys start from: special damages (medical bills plus lost wages) plus general damages (pain and suffering, calculated by the multiplier or per-diem method), reduced by the claimant's fault percentage, and adjusted for future costs. What emerges from that process is a negotiated figure, not a guaranteed one.
Step 1: Total your special (economic) damages
Special damages are financial losses you can document: hospital bills, surgeon fees, imaging, physical therapy, prescription costs, transportation to appointments, and any out-of-pocket expense not covered by insurance. Lost wages for every day you could not work belong here too, documented with pay stubs and an employer letter. Future medical costs projected by a physician in writing go here as well.
Step 2: Calculate general (non-economic) damages
Non-economic damages cover pain, suffering, emotional distress, and the activities you can no longer do. There is no receipt for any of that, so formulas give the number a footing. The multiplier method applies a severity factor of 1.5 to 5 to your medical bills. The per-diem method assigns a daily dollar value and multiplies by the number of recovery days. Both are starting points for negotiation, not final answers. See how to calculate lost wages and economic vs. non-economic damages for more detail on each component.
Step 3: Adjust for comparative negligence
If you share any responsibility for the accident, your recovery is reduced by your percentage of fault. A $100,000 claim becomes $70,000 at 30 percent fault. In the four states with contributory negligence rules, any fault at all can bar recovery entirely. See how comparative negligence reduces a settlement for the state-by-state breakdown.
Step 4: Check practical limits
The theoretical value of a claim and the amount you can actually collect are often not the same number. The at-fault party's liability policy is the most common ceiling. A defendant with a $50,000 policy and $150,000 in damages against them leaves a $100,000 gap that requires either litigation against personal assets or your own underinsured motorist coverage. Some states also cap non-economic damages by statute, regardless of what a jury would otherwise award.
How insurers arrive at their number
Large carriers often use proprietary valuation software. Colossus is one well-known example: it processes your medical records, treatment codes, and injury category to produce a claim score that drives the initial offer. The point is that adjusters are working from a formula. Thorough documentation and a formal demand with your own calculation give you something concrete to counter with. The pain and suffering calculator runs the same formulas with your figures.
See your own number
Plug your medical bills and injury severity into the calculator behind this framework.