No one is prepared for the unplanned loss of a car, taking time off from work, and fitting medical treatment into an already busy schedule. No matter your financial circumstances, this unforeseen event does take a mental, physical and financial toll on anybody. This article gives you information about claiming lost wages from your accident.
If you’ve been injured in a car accident, you deserve to be reimbursed for the income you lost while recovering from your injury.
The main question is how much income did you lose because of the accident. There are specific ways to calculate the figure and use evidence to support it. When calculating lost income for your car accident claim, you must include all forms of income.
How Lost Income and Lost Compensation Are Different
Arizona courts have regularly ruled that personal injury victims are entitled to reimbursement for all income they lost while recovering from their injuries. Lost income includes not only wages a victim would have earned if they hadn’t been injured but also additional compensation on top of a salary.
Wages are the amount of money your employer pays you for the work you do. These wages may be paid weekly, bi-weekly, or monthly and come in a company check or direct deposit.
Compensation represents the additional financial benefits of your employment, plus your capacity to earn. It is income above and beyond your wages. Such compensation may include sick and vacation days, pay bonuses, and other perks.
Don’t Overlook Other Types of Employment Compensation
If you had accrued 14 sick days and used 10 while recovering from your injuries, you have a right to be reimbursed for the value of those 10 sick days. You should be reimbursed because, if not, you would no longer have those days if you need to stay home to recover from the flu or other ailment. The value of each sick day is one day’s wages.
If you had to use your vacation days while recovering from your injuries, your settlement should compensate you because you should not have to lose those days thanks to someone else’s negligence . Like sick days, each one of those days represents a day’s wages.
Bonus days are any other days you earned or could have earned off from work. These could be national holidays, birthdays, “mental health” days, performance days, etc. Like sick and vacation days, each bonus day represents a day’s wages.
Bonuses are usually paid by employers based on an employee’s performance. This could be because you had the highest sales numbers for the month or hit some other type of performance benchmark. If injuries prevented you from getting a bonus you were in contention for, you can demand compensation for it.
Other Perks and Benefits
Perks are similar to bonuses but usually represent non-monetary compensation. These might include a company “work” vacation, use of a company car, free golf outings, or any other perk you realistically would have had if not for your injury.
Victims usually overlook these forms of lost compensation in personal injury claims. The insurance adjuster isn’t going to tell you to include them in your claim. You must figure out what you’re entitled to and add these yourself.
Insurance companies usually lump lost wages and lost compensation together, referring to the total as lost income. This is fine as long as you know the difference. Knowing all the types of lost compensation you can include in your demand can increase your final settlement amount.
Bring Supportive Evidence of Lost Income
You first need to have suffered legitimate injuries before taking time off from work. The best proof of those injuries is your doctor’s narrative. This includes a detailed write-up of your injuries, your diagnosis, and a prognosis for recovery. It must state your prescribed treatment and how long you should be out of work. You can also ask your doctor for a note that outlines when you can return to work and what activities you are limited to at work. Keep this continually updated as you progress through your treatment.
Your doctor’s narrative can include a “progressive prognosis,” that states approximately when you can return to your full job duties. It can include restrictions on the duties you can perform upon returning to work. For example, it should indicate the amount of time you can spend standing or the amount of weight you’re able to lift.
Tell your doctor you need a medical narrative for your claim. The more detail about your injuries, treatment, and your approximate recovery time, the better chance you’ll get reimbursed. You don’t want a vague narrative; it gives the adjuster a chance to argue against paying your lost income.
Get a Letter from Your Employer
To get more value out of your claim, you need to show legitimate proof of the income and additional compensation you lost during your treatment and recovery. You can ask for a written letter from your employer. Make sure it’s on company letterhead and signed by a manager.
The written documentation from your employer should confirm:
- The days you were absent
- Your hourly pay or salary at the time of the injury
- The number of hours you normally work each pay period
- Any overtime you worked in the weeks or months before the injury
- Any projects you were working on that would have resulted in extra compensation
- A promotion you were being considered for and is no longer available
- Any lost prizes for work performance, including vacations, tickets to shows, etc.
- Sick, bonus, and vacation days you used up while recovering
- Any other perks or benefits you lost
How the Self-employed Can Prove Lost Income
Self-employed people have the same right to recover lost income as anyone else. However, gathering proof of that lost income is a bit more challenging. Adjusters often consider lost income claims from the self-employed as suspect. If your lost income is substantial, you may need to hire an accountant. Typically, the person handling your books can create a profit and loss statement. It should 1) prove your income before the accident and 2) show a decline in income after the accident.
Proof of income can take many forms including:
- Bank statements showing deposits
- Profit and loss statements before and after the accident
- The prior year’s tax return
- Signed contracts executed close to the time of the accident
- Invoices and receipts
A forensic accountant can study the prior income of a self-employed individual and predict future income. They can prepare a detailed forecast of future income by factoring in the growth rate of your business, the addition of new customers, and income levels of similar businesses in your area.
If your business is not that complicated, you can do without a forensic accountant. Just gather a current financial statement and your tax returns for the past several years. If your business has been growing steadily for several years, you can include the average growth rate in your calculations.
If you were working with potential customers and lost them when you were injured, you can include copies of your correspondence to prove how close you were to bringing them on. If you can get them to write a letter confirming they would have become a customer had you not gotten injured, that would be even better.
Final Bit of Advice: Be Genuine
Don’t be tempted to exaggerate or “pad” your financial losses. If the adjuster catches this, you will lose all credibility. Every document you submit as evidence in your claim will be very closely scrutinized.
Take your documentation to your regular accountant and ask her to prepare a financial report supporting your calculations. Make sure she includes her fees. Then forward it to the adjuster. If the calculations are credible and supported by legitimate proof, the adjuster should approve your request for lost income.
The adjuster can’t refuse to reimburse your lost income simply because you’re self-employed. But the adjuster will likely dispute the amount you first demand. It comes down to how well you can prove the legitimacy of that lost income.
If you need help with overcoming the burden of proof, call us at (480) 634-7480. Our lawyers at the Thompson Law Firm are here to help see your lost wages claim through—and get you paid.