Compensatory Damages Definition

Compensatory Damages Definition
Compensatory Damages

What Exactly Are Compensatory Damages?

Compensatory damages are monetary awards made to an injured party to compensate for damages, injuries, or other losses. Compensatory damages are awarded in civil court cases where loss has occurred as a result of another party's negligence or unlawful behavior.

To be awarded compensatory damages, the plaintiff must demonstrate that a loss occurred and that it was caused by the defendant. In the eyes of the jury or judge, the plaintiff must also be able to quantify the amount of loss. 

What Is the Purpose of Compensatory Damages?

Actual damages are intended to provide only the monetary amount required to replace what was lost. In most civil court cases, compensatory damages are awarded to compensate for damages, injury, or other incurred loss. They differ from punitive and treble damages, as we will see later in the article.

There are two types of compensatory damages: actual and general.

Actual Compensatory Damages Examples

  • Hospital and medical bills
  • Medical procedures
  • Expenses for rehabilitation
  • Rehabilitation therapy
  • Expenses for ambulances
  • Prescription drugs and medications
  • Care in a nursing home
  • Services for the home
  • Medical supplies
  • Lost wages or income from employment
  • Increased living costs
  • Replacement or repair of property
  • Transportation
To be awarded actual compensatory damages, the plaintiff must demonstrate that the losses suffered have a monetary value.

General Compensatory Damages Examples

Meanwhile, general compensatory damages include loss estimates that do not involve actual monetary expenditure. Some courts employ the "multiplier method," which involves multiplying the total of one's actual damages by a number that represents the severity of the injury.

In other jurisdictions, courts will apply the "per diem" method, which assigns a monetary value to each day a plaintiff suffers and adds the total value of those days. A court may use a combination of these two methods to calculate general compensatory damages in some cases. Among the general compensatory damages are:
  • Disfigurement caused by mental anguish
  • Future medical costs
  • Future wage losses
  • Long-term physical discomfort and suffering
  • Consortium dissolution
  • Inconvenience
  • Dissatisfaction with life
  • Opportunity squandered
In medical malpractice lawsuits, compensatory damages are typically awarded for medical bills, hospital bills, rehabilitation expenses, and compensation for lost earnings. Some compensatory damages are difficult to calculate. For example, the value of lost wages for a more affluent member of society will be much higher than for someone who is poor or retired.

What Is the Distinction Between Compensatory and Punitive Damages?

Punitive damages, on the other hand, may compensate in excess of any loss or damage incurred and are intended to provide an incentive against repeating the act that caused the plaintiff's loss or damages.

Cases involving compensatory and punitive damages are a major source of contention in the field of health insurance, with proponents of tort reform claiming that excessive damages in excess of the actual loss incurred can raise the overall cost of healthcare.

Compensatory damages are meant to compensate the plaintiff of a lawsuit for the loss caused by the defendant.

What Is the Distinction Between Compensatory and Treble Damages?

Treble damages are a type of punitive damage that is intended to deter others from committing the same offense. When a plaintiff has purposefully or willfully violated a law, treble damages—which indicate that a statute exists to award a plaintiff up to three times actual or compensatory damages—are frequently invoked.

What Is a Synonym for Compensatory?
Offsetting, redeeming, or remunerative damages are other terms for compensatory damages.

What Exactly Is Compensatory Activity?
Compensatory activities are typically awarded in the form of monetary payments under the law.

What Are the Three Kinds of Damages?
Economic damages, non-economic damages, and punitive damages are the three types of damages.

What Are Compensatory Damages in General?
When referring to an injury claim, general compensatory damages cover all non-monetary damages, such as pain and suffering.

Do Compensatory Damages Cover Emotional Anguish?
Compensatory damages can include emotional anguish, mental anguish, and loss of enjoyment of life.

In conclusion

The plaintiff must demonstrate that a loss occurred in order to receive compensatory damages. Compensatory damages seek to "compensate" for any losses, whether physical, emotional, or mental. They are not the same as punitive or treble damages.
Mira Sandra
Mira Sandra I am Mira Sandra. A blogger, YouTuber, trader, Smart cooker, and Likes to review various products written on the blog. Starting to know the online business in 2014 and continue to learn about internet business and review various products until now.

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