Suppose you get injured in an accident and as a consequence one of your legs gets impaired. If you can blame someone else for the accident of you have an accident insurance you can claim a financial compensation for the injury. This compensation should pay for the inconvenience of the impairment of your leg (aggravated damages), the loss of earning capacity and the extra (medical) costs as a result of the accident.
Usually the compensation consists of a once-off payment while the damages are recurring each year.
With this calculator estimate yearly recurring damage amounts can be entered and converted into a once-off payment taking into account taxes, interest and inflation. Normally you will need the help of a professional to determine the yearly recurring amounts but it gives a lot of insight to play with this calculator yourself. An example calculation is described below.
All income and expense amounts are net yearly amounts: after taxes.
Suppose before the accident you earned $ 30000 net at an age of 35. The leg impairment makes you unsuitable for this job. So after the accident you have to look for another job. Eventually you find a suitable new job, but it pays you only $ 20000 net. Fortunately the new job doesn't require you to spend $ 1000 a year getting to your work. Also the accident does not reduce your life expectancy does not change as a result of the accident but stays at 80 years. However because of the accident and because of the conditions in your new job you will probably have to retire at 60 instead of at 65 years old. Normally your pension would be $ 20000 but now your pension will be only $ 12000. Finally you won't get any promotions in your new job, while you would almost certainly get a salary rise of net $ 10000 in your old job after five years.
On the costs side you will have $1000 per year extra heating costs in the 5 years you retire earlier. The aggravated damages, for the inconvenience of your leg impairment, are estimated to be $1500 per year. Finally you can not do simple maintenance of your house, including the cleaning of it. This causes you to spend $2500 extra per year until you reach a certain age, say 65.
The table below summarizes these financial facts:
|Total number of years:||45|
|Inflation, interest and taxes:|
|Wealth tax (%):||0|
|Tax on interest or on capital gain (%):||20|
The input data above can be entered faster by copying and pasting the text below to the field in tab Input from HTML of the calculator and then clicking Import data.
In this example the calculator computes a total once-off damage of $ 654166. The calculator does not give an exact figure but instead it computes a good approximation. So this result should be interpreted as personal injury damages of around 650 thousand dollar.