wrongful death settlement

A wrongful death lawsuit is a claim for money damages from someone whose negligence caused another’s death. Wrongful death lawsuits can be brought against anyone who negligently caused a death, including medical professionals, negligent drivers, and manufacturers. Calculating the amount of damages in a wrongful death lawsuit is difficult and often requires the expertise of financial professionals and economists. When wrongful death cases are resolved by a settlement, each case varies in the amount ultimately settled upon. Cases that proceed to trial through the court system may result in complete dismissal of the case or varying amounts of damages.


What Are Common Scenarios for a Wrongful Death Case?

Wrongful death cases often arise when there is evidence to show that a death would not have occurred but for the misconduct of another. If the person who caused the accident was negligent, then a wrongful death action is likely to succeed. Wrongful death lawsuits can be brought against drivers who disobey traffic laws and cause accidents, drivers who fail to pay attention, medical professionals who negligently perform services and any person who failed to exercise due care under the circumstances of the particular situation.


How is a Wrongful Death Settlement Determined?

settling wrongful death

Placing a monetary value on a life is incredibly difficult. There are, however several factors which may be considered to help reach a amount. These include:

  • The age of the deceased person
  • The deceased’s earning capacity
  • The deceased’s state of health
  • The deceased’s income at the time of death
  • The age and circumstances of the deceased’s dependents
  • The deceased’s education and training
  • Medical bills and other expenses incurred for the deceased
  • Funeral expenses
  • Value of lost benefits (e.g. pension, health insurance)

The damages amount must not be merely a ballpark estimate, but must be supported by objective evidence. Economists and other expert witnesses can look at the deceased person and their circumstances and consider the various circumstances to determine an amount.


How is it Paid Out?

Wrongful death settlements are often paid out by insurance providers who provide liability coverage for the person or entity for whom the death is being blamed. Insurance policies typically have a policy limit amount, above which the insurance company will not pay and the person is individually liable. If the responsible party does not have sufficient insurance coverage, they will be personally responsible for any judgment or settlement amount and possibly the legal fees accrued in the process.


Is it Taxable?

wrongful death settlements

According to the Internal Revenue Service (IRS), most wrongful death settlement payments are non-taxable, provided the payments are compensatory. This means that the compensation is meant to account for the pain and suffering experienced by the case. If the damages are considered punitive, or meant to punish the person responsible for the death, then the IRS may tax the punitive damages.

It is important that any award of damages clearly sets forth whether the damages are compensatory or punitive in nature. This will help resolve any confusion when it comes to reporting to the IRS. Anyone who may receive a wrongful death settlement should consult with an attorney and accountant to review the tax repercussions of any settlement proposal before it is accepted.


What Can You Do if You Disagree with the Settlement?

If you disagree with the settlement offer, you can proceed to trial and attempt to prove the right to damages and the amount of damages. Proceeding to trial can be risky, because there is no guarantee that you will receive the damages you are seeking. If successful at trial, you may be able to recover more than the settlement offer amount. Trial success is difficult to predict.


How Can a Lawyer Help?

A wrongful death attorney can help you review your case and determine what types of damages and what amount you can expect. An experienced attorney will be familiar with the amount of damages in cases similar to yours. A wrongful death attorney will be able to provide legal advice to assist you through the process. An attorney will also be able to negotiate settlement offers and make sure that you are not bullied into an unfair or unreasonable resolution. If your case proceeds to trial, a wrongful death attorney will know how to effectively present evidence in compliance with the court rules. While no wrongful death attorney can guarantee a successful result, your chances of recovering damages are significantly improved if you have a knowledgeable and experienced attorney to represent you in the process.