An estimated two million people are injured in car accidents each year in the United States. In many cases, accident victims are left waiting months or even years to get the compensation they’re entitled to. All the while, they’re left dealing with missed time from work, lost wages, mounting medical bills, and other expenses. Lost wages and ever-growing expenses can even place them at risk of losing the assets they’ve worked to build, such as their homes and savings. That’s where prejudgment interest comes into play.
What Is Prejudgment Interest?
Prejudgment interest is extra money that may be added to the compensation an accident victim receives from the person who’s responsible for their injuries and losses. It covers the time between when the accident happened and when the court awards compensation. It’s designed to make up for the time during which the victim didn’t have access to the money they needed to cover their expenses. Working with an attorney like those with The Millar Law Firm is the key to receiving not only fair compensation but also prejudgment interest.
How Does Prejudgment Interest Work?
If an accident victim takes their case to court and wins, the court may award prejudgment interest along with the amount of compensation the victim originally asked for. It only applies to economic damages, such as medical bills, lost income, and property damage. It usually doesn’t apply to non-economic damages like pain and suffering.
In Georgia, an accident victim can start accruing prejudgment interest 30 days after sending a demand letter for compensation to the at-fault driver. Prejudgment interest is only awarded in cases where the amount of compensation awarded in court equals or exceeds the amount the victim demanded. It’s calculated based on a predetermined interest rate and the amount of economic damages the plaintiff is awarded.
How Can an Accident Victim Receive Prejudgment Interest?
Prejudgment interest isn’t automatically awarded to accident victims. Their attorneys must formally request it as part of their lawsuits. Even then, not all victims are awarded prejudgment interest. Those who are deemed mostly at fault for their accidents or delays they experienced in receiving compensation may not be eligible. Certain other conditions may also apply.
How Does Prejudgment Interest Help Protect an Accident Victim’s Wealth?
Prejudgment interest can help protect an accident victim’s wealth in several ways. For one, accidents can cause significant financial hardships. If victims have to wait months or years to receive compensation, they may end up having to draw from their savings accounts, retirement funds, or other assets to cover their expenses and make ends meet.
This extra amount added to a victim’s compensation can make up for those hardships. It ensures a victim doesn’t ultimately end up worse off than they were before the accident. It can prevent them from having to go into debt to cover lost wages, medical bills, and other expenses as well. Furthermore, the possibility of owing prejudgment interest may encourage the at-fault party or their insurance company to settle sooner.
Ensuring Accident Victims Get the Full Compensation They’re Entitled to
Car accidents can be extremely costly for their victims. From having to replace their vehicles and other property they lost in the accident to covering resulting medical bills and facing hardships due to missed time from work, the costs can add up over time. Prejudgment interest may help make up for at least some of those difficulties. They can aid in protecting victims’ wealth and replacing some of the assets they may have been forced to sacrifice while waiting for compensation.
