Inflation And Your Personal Injury Case

February 14, 2023

How Does Inflation Affect Your Personal Injury Case? – Free Initial Consultations Available

Many jobs require some level of physical exertion. For those physically injured in an accident, their future earnings may be affected due to the nature of their work. When that happens, those victims may be entitled to future lost earnings to compensate them for their injuries. A personal injury case in New Jersey for future lost earnings may account for inflation.

Model Civil Jury Charge 8.11C

Pursuant to New Jersey Model Civil Jury Charge 8.11C:

“Effects of Interest and Inflation on Future Earnings

…Once you have decided how much money plaintiff will lose in the future, you must then consider the effects of inflation and interest. Consider the probable effects of inflation on reducing the purchasing power of money in the future. Your award for future losses may be increased to account for a loss in the purchasing power of money because of inflation.

Consider the probable effects of interest which will be earned on your award. You must not award [plaintiff] the exact amount of money that he/she will be losing in the future, because he/she will have that money now, although he/she will not have incurred the loss of that money until some time in the future. That means that he/she can invest the money and earn interest on it now, even though he/she otherwise would not have had that money to invest until a future date.

Therefore, you must make an adjustment for the award being available now, even though the loss will not be experienced until the future. This adjustment is called “discounting”; it gives you the present value of the money one receives now instead of at some future time. Discounting gives you the present value or present worth in a single amount of money which otherwise would to be received over a number of years at so much per year.

Your goal is to create a fund of money, which, if paid today, will fairly compensate plaintiff for his/her future loss of earnings. In doing so — in finding the present value of future losses — you must consider the interest the fund will probably earn in future years, as well as the effects of taxation on the interest earned and the effects of inflation in decreasing the purchase power of money. The higher the interest rate you believe the fund will earn in the future, the lower will be the amount of the fund needed today to fairly compensate [plaintiff] for future earnings. The higher the probable rate of inflation in the future, the higher the amount of the fund will be needed to fairly compensate [plaintiff]. Possibly, interest earned in the future could be offset exactly by the rate of inflation, causing these factors to cancel each other out; in that event, you need not adjust your award of future lost earnings for inflation or interest.”

Future Lost Earnings

As a result of New Jersey Model Civil Jury Charge 8.11C, a judge may instruct the jury to consider inflation in a personal injury award involving future lost earnings. Therefore, in addition to damages for pain and suffering, property damages and other economic damages, you may be entitled to future lost earnings accounting for inflation.

The Sloan Law Firm handles injury cases in Cranford, Elizabeth, Linden, Union, Plainfield, Westfield, Scotch Plains and throughout New Jersey. Attorney Daniel Sloan will demand that compensation for your injuries reflect inflation. If you or a loved one has been injured in an accident and would like to discuss the matter with a New Jersey Personal Injury Attorney, call the Sloan Law Firm at: (908) 358-2938. The initial consultations are always free.

RECENT PERSONAL INJURY RESULTS

$1,000,000 Recovery – Pedestrian hit by motor vehicle
$850,000 Recovery – Motorist struck by truck on highway
$250,000 Recovery – Husband and wife struck from behind on highway

CALL TODAY – (908) 358-2938 FOR A FREE PERSONAL INJURY CASE REVIEW

The Sloan Law Firm handles cases in Cranford, Linden, Scotch Plains, Union, Westfield, Plainfield and throughout New Jersey.