Compensatory Damages

Reviewed by Bhavana | Updated on Aug 27, 2020

What Does a Compensatory Damage Mean?

Compensatory damage is money awarded to a claimant to compensate for damage, injury, or other loss incurred. Compensatory damage is awarded in a civil court case where there has been a loss as a result of another party's negligence or unlawful conduct.

The claimant must show that a loss occurred and that it was due to the defendant, in order to receive compensatory damages. The claimant must also have the ability to quantify the amount of loss in front of the jury or judge's eyes.

How is it Different from Punitive Damage?

Compensatory damages are different from punitive damages, which can cover more than any loss or damage suffered, and are meant to provide an incentive against repeating the act that caused the loss or damage to the claimant.

Cases relating to compensatory and punitive damages are a significant source of debate in the area of health insurance, as tort reform proponents claim that unfair penalties over actual loss were sustained in order to increase overall healthcare costs.

Compensatory damages are meant to provide a lawsuit's victim with additional money to cover the defendant's harm incurred.

Actual Compensatory Damage Examples

  • Medical and hospital bills
  • Rehabilitation expenses
  • Medical treatments
  • Ambulance expenses
  • Physiotherapy
  • Nursing home care
  • Domestic services
  • Medicine and Prescription drugs
  • Lost wages or lost employment income
  • Medical equipment
  • Transportation
  • Property replacement or repair
  • Increased living expenses

Sometimes, compensatory damage can be hard to assess. For example, for a more wealthy member of society, the value of lost wages will be much higher than someone who is poor or retired.

General Compensatory Damages

  • Disfigurement
  • Mental anguish
  • Future lost wages
  • Future medical expenses
  • Loss of consortium
  • Long-term physical pain and suffering
  • Loss of opportunity
  • Loss of enjoyment of life
  • Inconvenience