What Are Punitive Damages? 

Last Updated on February 5, 2024 by John Robinson

Certain damages are typically awarded to the victim upon sustaining a personal injury. These consist of economic and non-economic compensatory damages and sometimes punitive damages. Punitive damages, also known as exemplary damages, are not meant to compensate the victim. 

Punitive damages are awarded to the injured party to punish the defendant. They are historically only awarded when the defendant’s behavior was particularly egregious, and they acted with willful, intentional misconduct. Punitive damages serve as a deterrent for the defendant and others so that similar behavior is not repeated. 

Essential Things to Know About Punitive Damages

Punitive damages differ from other damages that may be awarded to an injury victim. Some of the key points that you should know about punitive damages are listed below: 

  • Punitive damages are meant to punish the wrongdoer because it is evident that they are guilty of the offense for which they were accused.
  • They are not compensatory damages. The court awards these to punish the defendant’s intentional misconduct.
  • Punitive damages are ordered over and above the compensation the victim receives in the hopes that it will discourage the defendant and others from engaging in similar wrongdoings going forward.
  • The amount awarded in punitive damages varies from state to state. A typical cap placed on punitive damages takes the compensatory damages into account and multiplies them by four. 

Speak to a personal injury lawyer if you need advice about whether you will likely be awarded punitive damages. Each state handles punitive damages differently, so your attorney can clear up any questions you may have.

The Purpose of Punitive Damages

If you or your loved one is determined by the court to be eligible for punitive damages, it is essential to note that they are not awarded alone. They are not awarded as a stand-alone type of damage. They will increase the amount you receive in your personal injury suit since compensation will also be awarded. 

Punitive damages are strictly a way to punish the defendant for intentionally behaving in a way that caused harm to the victim. By awarding punitive damages, the court is making an effort to keep others safe by discouraging such behavior from continuing. 

Compensatory damages are there to cover the damages sustained by the victim. Compensation is awarded for various reasons. The most common of these are listed below: 

  • Medical expenses
  • Hospital bills
  • Property damage
  • Lost income
  • Pain and suffering 
  • Scarring and disfigurement
  • Permanent disabilities
  • Mobility devices
  • Therapy
  • Post-traumatic stress disorder (PTSD)
  • Loss of enjoyment of life

Compensation for what was lost in the accident is owed to the victim so that they can pay their bills and move forward with their life. Punitive damages are awarded on top of the compensatory damages. They punish the defendant while rewarding the injured party.

Situations That Result in Punitive Damages

Many situations can result in punitive damages being awarded. There are as many cases as there are personal injuries. Some examples are as follows:

  • A doctor operates while under the influence of drugs or alcohol, causing them to nick one of the patient’s other organs, resulting in emergency action having to be taken so that the patient does not bleed out. 
  • A car manufacturer designs a vehicle with a flaw that causes it to roll over more easily than it should. But, they chose not to correct the defect, even knowing it might be dangerous. 
  • Punitive damages might be awarded if a defective pacemaker was installed and a patient suffered or lost their life. This is especially true if the defect was something the manufacturer was aware of the defect.

If any of these or other incidents lead to a civil lawsuit, the court may find that the victim should be compensated for their losses and that the party who caused the above problems should be awarded punitive damages on top of their compensation settlement.

Factors Influencing Punitive Damages

Punitive damages are not always a given. The court will consider several aspects of the case before deciding to award them. They will need to answer the following questions:

  • Were the defendant’s actions done out of malice?
  • Were they behaving grossly negligent? 
  • Were punitive damages awarded in similar cases? 

Punitive damages may be awarded, depending on how the above questions were answered. 

States Determine the Rules Around Punitive Damages

Punitive damages vary by state. Each state adopts its own structure when it comes to punitive damages. Some states are more generous than others as far as punitive damages go.

Caps on Punitive Damages

The state and the Supreme Court provide capping guidelines. While in some states, there is no maximum cap on punitive damages. They usually would not exceed four times what the compensatory damages amounted to. 

An example of this equation is a person injured in a premises liability case awarded $200,000 in damages. The court might grant the victims $800,000 in punitive damages. Higher punitive amounts are awarded when the court finds that the misconduct was especially heinous. 

The Difference Between Compensatory Damages and Punitive Damages

Compensatory damages provide reimbursement for the losses the victim sustained. Punitive damages are awarded in addition to compensatory damages if the cause of their injuries were caused due to grossly negligent, willful misconduct, or were a result of malice. The defendant and those in similar positions are then discouraged from repeated offenses.

Punitive Damages are Rare

Punitive damages are rarely awarded often, only around 5% of the time. When awarded, the amount varies depending on the state. Some states have damages caps that limit the amount that can be awarded. Other times, they rarely reach four times the compensatory damages amount. 

Punitive Damages are Taxable

Compensatory losses are not considered income and are not taxable. However, while many are dealing with taxation issues, others are immersed in the world of online casinos. For example, it’s worth knowing about the phenomenon of bonushunting. What is bonushunting and who are online casino bonushunters? These are players who specialize in receiving and wagering bonuses, using a mathematical approach to capitalize on them. Read more in this article https://mydnepr.info/shho-take-bonushanting-i-hto-taki-bonushanteri-onlajn-kazino-73331. Back to taxes, punitive damages are not considered compensation and are reported as “other income” and taxed.

Contact a Personal Injury Attorney Today

If you have questions about the types of damages that you are entitled to, contact a personal injury attorney for advice. They can answer any questions you might have and analyze your case’s specifics to determine if you are likely to receive punitive damages.

John Robinson
John Robinson

Howdy! I’m John Robinson from Levittown, New York. I am a mechanical engineer for 15 years and already had an established car repair company. I developed a personal relationship with cars since I was a kid. I always love the sounds and smell emitted by a car or truck and even at construction machinery. Since then I have been married but my love for cars only grew.