What Are the Differences Between Compensatory and Punitive Damages?

Injury Attorneys | Restoring LivesTM

There are two types of damages. One is called compensatory damages and the other is punitive damages.

Compensatory damages are intended to compensate a person for the injuries they have suffered. Things like medical bills, pain and suffering, wage loss, permanent impairment of function—those are all under the heading of compensatory damages.

Punitive damages are very rare, actually, and they only are appropriate in a case where the defendant’s conduct is so grossly negligent or so close to reckless or criminal behavior that the defendant ought to be punished for his or her wrongdoing. Punitive damages are not intended to compensate somebody for a loss; they’re really intended to punish the wrongdoer for conduct that is above and beyond just negligence.

Some examples would be if a company has engaged in a long pattern of mistreating people or engaging in behavior that is reckless on a number of occasions or, if on the occasion in question, the company has acted with gross indifference to the safety of somebody. Those would be punitive damages type of situations.

Those are rare. By far, the most common type of damages awarded would be compensatory damages, which are intended to compensate somebody for the damages and losses they have suffered from an injury from an accident.

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