What’s the Difference between Compensatory and Punitive Damages?

The first type of damage award is intended to compensate injured parties, and the second is intended to punish defendants. When a claimant is seeking compensation for the damages they’ve suffered as a result of an injury such as medical bills, property damage, and more – they are seeking compensatory damages.

There are two kinds of compensatory damages: economic (or “special”) damages and non-economic damages. Economic damages are those that can be measured in money, whether it was spent or lost. They often include:

  • Medical bills—examinations, prescriptions, treatment
  • Travel expenses for medical treatment
  • Alternative transportation costs (in the case of a car accident)
  • Property damage
  • Lost wages or reduced earning opportunities

Past compensatory damages are calculated from bills and receipts, and the total required in the future can be estimated based on your future care plan and other circumstances specific to your case. This is why attorneys sometimes need to consult doctors about the kind of treatment one would need over years for a serious injury.

Non-economic damages, also called “general damages,” include intangible losses that cannot be measured but are nonetheless genuine and worthy of compensation. A claim for pain and suffering, emotional distress, or loss of enjoyment of life is a claim for non-economic damages.

Computing a total for a claim of non-economic damages can be tricky. Attorneys often use multipliers for this purpose. Depending on the circumstances of the accident—the life impact of the injuries, the likelihood of complete recovery, and other factors—they choose a number between 1.5 and 5. They multiply the total claim for compensatory damages by this number to reach an amount for the non-economic damage claim.

Many states limit or “cap” certain damage awards in personal injury cases. South Carolina does not limit the amount of compensatory damage awards in most cases. However, when plaintiffs have claims against the state of South Carolina itself—for example, from accidents involving government employees—they may usually only recover up to $300,000 per single occurrence, and no punitive damages. In some instances the government’s liability can be higher, such as when there are multiple distinct occurrences or if the claim involves medical malpractice.

Although economic damages are not limited in most South Carolina medical malpractice cases, non-economic damages are capped at an amount that is periodically adjusted for inflation. This cap may be lifted if the defendant destroyed relevant records, committed fraud, or caused the plaintiff’s non-economic damages through “grossly negligent, wilful, wanton, or reckless” conduct. S.C. Code § 15-32-220.

Comparative Negligence in South Carolina

A claimant may not be entitled to all the damages they request. It depends on whether they shared responsibility for the incident. Under South Carolina law, a court determines the percentage of fault for each party in a personal injury case. If the plaintiff is 50% or less at fault, they are entitled to recover damages, but their percentage of fault reduces the total they can receive. For example, a plaintiff who was 10% at fault and presented a damage claim of $10,000 could recover $9,000. However, if the plaintiff was over 50% at fault, they could not recover any damages.
In practice, most personal injury claims—especially auto accident claims—don’t go to court. Instead, they are resolved by settlement between the insurance companies covering the parties. Insurance adjusters investigate the accident circumstances, then produce internal reports suggesting the value of each case. These reports form the basis of any settlement offers the company may make.

But, the insurance company’s determinations do not have the force of law. Insurance companies have an incentive to undercut and lowball their claimants, and they may use their conclusions about fault to do so. A personal injury attorney can push back against insurance company determinations and show that their clients deserve a better deal. Access to the civil justice system is the most powerful tool our clients have to fight back against insurance companies and large corporations, and it is our privilege to walk into the fight beside them.

Punitive Damages

In South Carolina, punitive damages, also called “exemplary damages,” are relatively rare. Punitive damages are not awarded to replace money that a plaintiff lost. Instead, like fines, they punish a defendant’s actions and discourage others from doing the same.

In some cases where a plaintiff receives compensatory damages, a jury may also decide whether to award them punitive damages—but only if the plaintiff can prove “by clear and convincing evidence that [the] harm was the result of the defendant’s wilful, wanton, or reckless conduct.” S.C. Code § 15-32-520(D).

In deciding how much to award, the jury can consider, among other factors:

  • How severe the harm was
  • Any responsibility that the plaintiff also had
  • Whether the defendant had done this before
  • Whether the defendant concealed what they had done
  • Whether the defendant’s actions were profitable to them

Punitive damages are usually limited to three times the amount of compensatory damages or an inflation-adjusted cap, currently at $677,065—whichever is greater. However, if a jury recommends a higher award, the judge may consider certain aggravating factors and raise the cap. In any case, there is no limit on punitive damages if the defendant intended the harm that they did, acted while intoxicated, or had been previously convicted of a felony for the same behavior.

How to Understand Your Claims

An experienced personal injury attorney understands what kind of damages you may be entitled to and how to prove them. At Cavanaugh & Thickens, LLC, we handle personal injury cases and insurance settlements daily, particularly those involving:

If you have any kind of South Carolina personal injury claim, we would be glad to talk to you. Call us today at (803) 888-2200 to schedule an appointment in our Columbia or Charleston offices.