If you’ve suffered harm in an accident caused by negligence or misconduct, you may be legally entitled to monetary compensation. Two main damage categories apply in personal injury cases – compensatory and punitive.
Each type serves a specific purpose and is calculated differently. So what exactly is the difference between these two critical compensation components available through lawsuits?
In this article, we’ll provide an easy-to-understand overview of compensatory and punitive damages.
Compensatory Damages Cover the Plaintiff’s Losses
Compensatory damages, also called actual damages, are awarded to reimburse the plaintiff for any losses suffered due to the defendant’s negligence or misconduct. Both economic and non-economic damages may be among them.
Economic Damages
Economic compensatory damages cover tangible losses with a specific monetary value. These include medical expenses, lost wages and income, property damage, and other costs from the accident. Plaintiffs can claim current and future economic losses – for example, we can seek compensation for future medical treatment or lost earning capacity.
Non-Economic Damages
Non-economic compensatory damages cover intangible losses like pain and suffering, loss of enjoyment of life, disfigurement, physical impairment, and emotional distress. While harder to quantify, non-economic damages account for the real personal impact an injury can have. Skilled personal injury lawyers know how to value these damages.
Compensatory damages aim to make the plaintiff “whole again” by providing funds to cover all accident-related losses. This promotes fairness and accountability.
Punitive Damages Punish and Deter Wrongdoing
Punitive damages, also called exemplary damages, are awarded not to compensate the victim but to punish egregious actions by the defendant. Section 895.043 of Wisconsin law allows for punitive damages when the defendant acted maliciously or intentionally disregards the plaintiff’s rights.
The purpose is twofold – punish the defendant for misconduct and deter similar wrongdoing in the future. Punitive damages act as a warning to others that certain behavior will not be tolerated. This protects the broader public interest.
Along with compensatory damages, punitive damages are granted. While less common, they can greatly increase the total value of a personal injury claim.
Key Differences Between Compensatory & Punitive Damages
There are several notable differences between compensatory and punitive damages:
- Purpose – Compensatory damages reimburse losses, while punitive damages punish and deter.
- Types – Compensatory is split into economic and non-economic, while punitive is a single category.
- Frequency – Compensatory damages are awarded in most successful injury cases, but punitive damages are rare.
- Standard of proof – Compensatory damages require proving liability, but punitive require further evidence of malicious intent or gross negligence.
- Caps on amounts – Compensatory damages are not capped, but punitive damages are limited in some states.
- Who pays – Compensatory is paid by insurance companies, while the defendant personally pays punitive damages.
Compensatory damages should apply to most successful personal injury claims, as they reimburse proven losses. Punitive damages are less common but may come into play if the defendant’s behavior was especially unethical or reckless.
Contact the personal injury attorneys at Welcenbach Law Offices today at to explore your options. With decades of experience, we have the skills and resources to build a strong claim for maximum compensation under Wisconsin law.
Don’t delay – visit https://www.welcenbachlaw.com/ today to get started.