Punitive vs. Compensatory Damages: What’s the Difference?

When you’re injured in an accident that was someone else’s fault, how much money are you entitled to? This question is one that civil courts and lawyers like us spend our lives answering. Yet that answer can vary widely depending on the circumstances of your case. One of the biggest factors to consider is compensatory vs. punitive damages.

What Are Damages in a Personal Injury Case?

The general term “damages” means the monetary compensation you can be awarded in a personal injury case as payment for the harm you suffered. In legal terms, this payment is intended to “make you whole.” There are two types of damages in personal injury cases: compensatory and punitive.

What Are Compensatory Damages?

Compensatory damages are the monetary amounts you can be awarded for your actual loss. Property damage; hospital, rehabilitation and other medical bills; and anticipated future expenses can all fall under the category of compensatory damages. These are then separated into two more categories: economic and non-economic.

Economic vs. Non-economic Damages

Economic damages are real financial losses, including medical expenses, costs to replace or repair property, lost wages, and your litigation costs. They are quantifiable, meaning you can prove them with physical evidence, like bills. That means you can also add them up and arrive at a real number, which makes them easy to prove and calculate.

Non-economic damages aren’t as immediately obvious or quantifiable. They include pain and suffering, emotional distress, shorter life expectancies, defamation, loss of companionship, and “loss of consortium” (difficulty forming relationships). While it is possible to gather evidence to prove these damages, for example, from witnesses, experts and psychiatrists, it’s much harder to arrive at an actual monetary amount that you should be compensated for.

When Are Compensatory Damages Awarded?

Compensatory damages are awarded much more frequently than punitive. Types of personal injury cases that have historically awarded compensatory damages include:

• Bicycle accidents
• Boating accidents
• Car accidents
• Construction accidents
• Motorcycle crashes
• Slip-and-fall claims
• Truck accidents
• Workplace injuries

Compensatory damages are also awarded in wrongful death claims. The victim’s family may be entitled to compensation for medical bills, funeral costs, lost earnings, and loss of companionship.

What Are Punitive Damages?

Punitive damages, also known as exemplary damages, go beyond compensating the victim. Their aim is to punish the defendant for egregious wrongdoing so that they won’t do it again. Corporations and other large organizations are the most common target for punitive damages, but individuals can also be ordered to pay them for especially bad behavior. Defendants can also be charged in criminal court for these offenses.

How Are Punitive Damages Calculated?

Like non-economic damages, punitive damages aren’t based on cold, hard facts and can therefore be hard to calculate. In Oklahoma, the guidelines are found in Oklahoma Statutes Title 23, Section 9.1. The court can consider:

• How serious of a hazard the defendant posed
• Whether the defendant profited from their misconduct
• How long the misconduct lasted
• Whether the defendant was aware of the hazard
• What the defendant did when they discovered the hazard
• Whether the defendant tried to conceal it and how many people were involved
• The defendant’s financial condition

Section 9.1 also provides guidelines for the amount of punitive damages that can be awarded based on the level of malice, or ill will, the court finds. When a defendant has acted “intentionally and with malice,” there is no limit to the amount the court can award.

When Are Punitive Damages Awarded?

When it comes to punitive vs. compensatory damages, the punitive variety is much less likely to be awarded. However, if the court determines that the defendant purposely acted “without regard to the safety and well-being of others,” they are possible. Examples include:

• Class action lawsuits
• Drunk driving
• Malicious activity
• Medical malpractice
• Serious injuries and wrongful deaths

What’s the Difference Between Compensatory and Punitive Damages?

The main difference between compensatory and punitive damages is that compensatory damages are meant to compensate you for your injuries, while punitive damages are meant to punish the offender who caused the injuries. Put another way, compensatory damages are designed to provide you with the justice you deserve. Punitive damages are designed to prevent it from happening again. If you win your case, you can receive both types of damages.

Limitations on Damages in Oklahoma

Oklahoma Statutes Title 12, Section 95 sets a statute of limitations for many types of civil suits. This means you only have a certain amount of time from the date of the incident to file your claim. The limitations include:

• Personal injury: 2 years
• Medical malpractice: 2 years
• Property damage or trespass: 2 years
• Fraud: 2 years
• Defamation: 1 year
• Birth injury: 7 years (Title 12, Section 12-96)

There may also be limitations on the amount of damages in some cases. For compensatory damages, you can usually recover all of your economic damages (medical bills, lost wages, etc.) and up to $350,000 in non-economic damages.

For punitive damages, unless the defendant’s conduct was especially bad, you can usually recover up to $100,000 or the amount of compensatory damages you were awarded. But, as discussed above, if the court finds “reckless disregard for the rights of others,” there is no limit to punitive damages.

The Bottom Line

An experienced personal injury attorney like the Oklahoma Injury Guy can fully explain compensatory vs. punitive damages and assess your case to give you a more personalized estimate of what you might receive. An attorney can also give you more negotiating power. We’ve been here before, and we know what you deserve. Contact us today and we’ll guide you through the process.