Court Discusses How Insurance Coverage Comes into Play When Calculating Damages in a California Personal Injury Lawsuit

In California personal injury cases, there are two types of damages awards. The first type, compensatory damages, attempts to put the plaintiff in the position in which they were prior to being involved in the accident. The second type, punitive damages, is less common and focuses on deterring especially bad conduct by the defendant.

Legal News GavelWhen it comes to determining compensatory damages, a jury will review the evidence and make the final decision. However, a jury’s damages award must comply with the law. When it comes to determining the type and amount of damages that a personal injury victim is entitled to receive, courts often have to deal with the issue of insurance.

Insurance can complicate the damages calculation process because in many cases an injured plaintiff’s insurance company – or the insurance company of the at-fault driver – will reimburse the plaintiff for the costs of the medical expenses. Further complicating the matter is the fact that insurance companies have often negotiated discounted rates, such that the book value of the services provided is far greater than the amount actually paid out by the insurance company.

In general, due to the stated purpose of compensatory damages, a plaintiff may not recover for the book value of their medical expenses. Instead, they can only recover for amounts actually paid or still outstanding. In a recent case, a California appellate court discussed how lower courts should handle situations in which a plaintiff voluntarily opts to obtain treatment outside their network.

The Facts of the Case

The plaintiff was involved in an accident when his motor home was rear-ended by a semi-truck. The plaintiff sustained serious injuries as a result, and although the plaintiff was insured, he decided to obtain treatment outside the insurance company’s network.

The defendant claimed that the plaintiff should not be able to introduce evidence of his actual medical expenses because it was the plaintiff’s choice to obtain what he knew would be much more expensive treatment. Instead, the defendant suggested the court use the negotiated rates that would have been paid had the plaintiff obtained in-network treatment. In support of its position, the defendant had medical experts testify that 95% of patients would not pay the full out-of-network costs. Essentially, the defendant claimed that the plaintiff failed to mitigate his damages and that the defendant should not be on the hook for the difference because the plaintiff incurred such high medical bills based on his own choice.

The plaintiff argued that he should be considered “uninsured” for the purposes of determining the damages he was entitled to receive because he did not obtain care through his insurance policy. The court agreed, explaining that there are many reasons why an accident victim may want to obtain care outside their network, and accident victims should be able to choose where they obtain medical care. In this case, the court noted that the plaintiff’s injuries required complicated surgeries, and it was his right to seek out certain specialists he believed were best qualified to provide treatment.

Have You Been Injured in a California Car Accident?

If you or a loved one has recently been injured in a car accident, you may be entitled to monetary compensation. The dedicated California personal injury attorneys at Sharifi Firm have extensive experience representing victims and their families in a wide range of California personal injury matters. To learn more, call 866-422-7222 to schedule your free consultation today. Calling is free, and we will not bill you for our services unless we are able to help you obtain the compensation you deserve.

More Blog Posts:

Study Finds that Hit-and-Run Accidents in California Are on the Rise, Southern California Injury Lawyer Blog, May 4, 2018

According to Recent California Appellate Opinion, Landlord Has No Legal Duty to Provide Defibrillator Device, Southern California Injury Lawyer Blog, April 19, 2018

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