How to Calculate Compensatory Damages

By Ginger Kelly
Compensatory damages include loss of value.

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When an individual has sustained an injury or a loss due to the actions of another individual or company, a court will decide what compensatory damages, if any, the individual is entitled to. Compensatory damage is an award that is calculated after a loss to make the individual financially whole again, and can be awarded separately or in conjunction with punitive damages. Punitive damages are meant to deter the injurious behavior from repeating itself in the future.

Provide clear evidence that you have sustained an injury that can be compensated for financially. It is helpful to have receipts, purchase orders and photographs to prove the actual losses that were sustained. This will provide a starting point when calculating the compensatory damages that you are entitled to.

Decide what the fair market value is for the items that you have lost. In other words, figure out how much would it cost you if you had to replace the items that you lost, in the same condition that they were in at the time of your loss. It can be helpful to review classified ads for similar items to establish a ballpark figure of what the items would be worth in cash value.

Add up the total replacement cost for your items. Add the other costs and fees that you have incurred in prosecuting the lawsuit, including your attorney fees, postage and filing fees. You can also include other losses for which you are entitled to compensation, such as loss of work or loss of lifestyle.

Consider the loss of value of an item while calculating your losses. For example, a vehicle that got into an accident will not sell for the same amount as a vehicle that has never been in an accident, which means the value of the vehicle has now decreased. All of these things need to be added up when compensatory damages are being calculated, in order for you to be made whole again.

About the Author

Ginger Kelly has been an accomplished professional writer since 1997. She began her career writing for school newsletters and newspapers, then moved on to community newspapers. Kelly has written various articles on a variety of topics ranging from parenting to health care. She is a paralegal graduate of Blackstone College.

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