How do insurance companies calculate “lost wages,” especially loss of future earnings?

Calculating Future Earnings Injury Law

How do insurance companies calculate “lost wages,” especially loss of future earnings?

Calculating lost wages can be very tricky or very easy, depending upon your situation.

Here’s the easy kind. If you are injured and you have a 40-hour a week job, work no overtime, are off work for two weeks, and then go back full time, all the insurance company wants is documentation to support your claim and you should be paid for your loss. Suppose you are an office worker, and you make $40,000 a year, or $3167 a month. Your doctor tells you to take off two weeks, documents it with a signed authorization, your employer writes a letter to say how much money you lost, (about $1528), and your doctor documents when you may return to work. Your claim is for $1528-even if you used vacation or sick time. Some states only pay net wages, so they may ask for your pay stubs to calculate and deduct taxes. Most pay gross wages. But that’s it. Even if your doctor tells you you may need a couple of more weeks off, it’s easy to figure that out, too, and it’s done the same way.

Here’s the tricky kind. You were seriously injured and have missed about 3 months of work. It is estimated by your physician that you may miss about a year or more. It’s possible that your employer may not hold your job, so at the end of the year, you may find yourself unemployed. How will the insurance company calculate your lost wages and loss of future earnings? With great difficulty! So it’s up to you to document it all and prove your case. The amount you will not earn at your present job is easy to calculate-just like we did with the simpler case above. Put together the figures for what you have lost in the three months of work you’ve missed so far.

The company may or may not be willing to hold your job depending on a variety of economic factors. When future earnings are at stake, that’s where the tricky part comes in. Even if the company is willing to hold the job for a year, such variables as promotions you would have gotten, inflation, corporate reorganization, layoffs, raises, and fringe benefits, all come into play. With the possibility that your job may not still be there when you are ready to return to work, you will also need to document the time it takes you to find a new job. Perhaps the new job won’t pay as well. You’ll need to document the difference in pay, but over how long? Until retirement? Or what if you were permanently disabled by the accident and you will never be able to go back to work? Your lost earning capacity (capacity to earn money in the future) will need to be addressed.

Often, should a case be this complicated, your attorney will hire an economic expert called a forensic economist to lay out the data for your future income and the proof of your future losses. Such an expert has experience handling these types of cases. They look at such factors as age, physical or mental impairments, employment history, job skills, education, employer evaluations, earnings history and economic lifestyle. The expert then constructs a profile of past and present economic facts to begin to formulate the value you will lose in future years, using life expectancy tables if you will never work again, earnings of others with your educational and experience levels in your occupation, inflation, social security and other benefits, plus other statistical data. The economist then explains it in as simple terms as possible to the jury or in a deposition (testimony under oath but not in court) to help the jury or insurance adjuster to understand the amount of the loss.

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How do insurance companies and juries assign values to pain and suffering? What factors do they take into account?

Pain And Suffering Factors Injury Law

How do insurance companies and juries assign values to pain and suffering? What factors do they take into account?

Putting a value on pain and suffering is probably the most difficult task for a jury in any injury case. There is no scientific formula and no chart or table juries, attorneys or insurance companies can look to. Every injury, every injured person, every accident and every case is different and deserves a thorough evaluation. Two people can have the same injury and one can suffer little while the other suffers a great deal; or one offers better proof than the other with more complete documentation or better witnesses; or they can be in two different parts of the country and get completely different settlements or awards.

There are many, many factors that must be taken into account to determine how much money someone will get for their pain and suffering. Juries and insurance companies look at the credibility of the witnesses. Were the injured person’s actions consistent with those of someone who was in pain? Were there any pre-existing injuries? Were they able to do what they normally do in their everyday lives, or were they forced to change or reduce their activities. What is their tolerance for pain in general? What do they do for a living? What is their marital status and family situation? How sympathetic a witness do they make? How skilled is their attorney at presenting their case? All these factors go into the evaluation of pain and suffering. Having said that, suppose we look at a hypothetical case where everything is practically the same for the injured parties, so you can see how the above factors added either one at a time or in combination, effect the outcome.

Suppose three people were injured on a bus. They all have the exact same injury, were treated by the same physician, received similar treatment, and incurred the same medical bills. They are all in their mid-thirties, live in the same zip code area, used the same lawyer to represent them and were all able to go back to their regular activities after 3 days of rest and recuperation. They are all homemakers in their mid-thirties. Will they all get the same amount for pain and suffering? On the surface, they should, right? But, what if homemaker A has a lower tolerance for pain than homemakers B and C? Shouldn’t she get more because she suffered more? If she can convince the jury or insurance company of this, then, yes, she will probably get more. Even one small difference can change everything.

Now, let’s take a look at the real world where no one and nothing is the same. The following changes may each, or in combination with other changes, have an impact, sometimes a significant impact, on the amount each person will be awarded for pain and suffering.

. Job/Income

Let’s keep the first person a homemaker, and make the second a blue-collar worker for the postal service, making $35,000 a year. The third is a successful accountant who earns $250,000 a year. The attorney brought the lawsuit against the bus company and tried the case together before the same jury. Will they all get the same amount for pain and suffering? Again, in theory, they should. Nothing is different, except their jobs and incomes, and what does that have to do with pain and suffering? Might the jury see the accountant as well off and not as needy as the postal worker and, thus, give him less? Might the insurance adjuster see the homemaker as someone who can afford to stay home, also not so needy? Might they see the postal worker as the hardest working among them, and want to give him more money? Job and income can definitely tip a jury one way or the other.

. Different ages

The homemaker is 32, the postal worker, 50, and the accountant, 67. Will there be a difference in the amount they each get for pain and suffering now? Quite possibly. Why? The accountant, at 67, is likely close to retiring. A jury may see that he probably has saved a lot of money given his large income and is ready to retire and is not as needy as the others. Pain and suffering is not based on need, but juries are people just like you and me and swayed by things that talk to all of us. Or they can see it the other way, that he’s older and probably suffered more because his body is not in as good shape as the others. At 50, the postal worker likely has years to go before he retires and doesn’t make a lot of money as it is. They may be sympathetic to his plight and give him more. The homemaker is young and will probably heal quicker. Or they may see her as having suffered more because she had to continue caring for children while healing from her injury. So you see how a small change like the age of a person may have a big impact on the award, in either direction.

. Different community/lifestyle

The homemaker lives in a suburban, gated housing development in a single-family home. The postal worker lives in a one-bedroom apartment in an urban area, and he travels everywhere by bus. The accountant lives high in the hills over an urban area in a 4-bedroom house, and has a housekeeper. Will this change make a difference? It could very well. The postal worker is obviously (to a jury) the least well off and may come across as the neediest. Should that have anything to do with pain and suffering? It could; everything does. He has to take a bus to work from where he lives-that might equal more inconvenience for him, and they may be more sympathetic to that. The homemaker seems to be in very comfortable surroundings and she has chosen not to work or doesn’t have to. They may not want to give her much. And with a housekeeper, the accountant may not evoke much sympathy.

. Different attorney

Now let’s add a different attorney for each injured person into the mix. The homemaker’s husband is her attorney. He is really a family law attorney, but he thought he could handle this for his wife. The postal worker hired a personal injury attorney who represented his friend in a car accident. He’s been out of law school for two years and works for a small law firm. The accountant hired a personal injury attorney with whom he shares office space, and who has practiced for twenty years. Will this make a difference? Most definitely. You want an experienced attorney who knows how to evaluate your case, how to tell your story convincingly to the other side and to a jury, how to negotiate and advocate for you. I would bet the accountant would do better here than the other two as a result of their choices of attorney.

. Where the case is filed

If the accountant’s case is filed in New York City, the postal worker’s case is filed in Broken Bow, Nebraska, and the homemaker’s case is filed in Des Moines, Iowa, who do you think has a chance of getting a higher award for pain and suffering? If you said the accountant, you are probably right. It matters where the case is filed. Juries in urban areas, in general, award more money than in small towns and rural areas. Big cities generally award more than small cities.

. Attitude/witness quality

Suppose the postal worker is honest, but hesitant when he testifies because he’s nervous. He has trouble telling his story because he can’t find the right words. He looks scared to death. Perhaps the accountant has a bit of an attitude, and it comes across to the jury that he thinks he has a lot of money coming to him. His body language shows that he thinks he’s very important, he keeps looking at his watch, and he winks at a young woman on the jury. He also grins inappropriately when questioned by opposing counsel. The homemaker is confident in her testimony, well spoken, and comes across as honest. How will these “performances” affect the amount of money these people will get for pain and suffering? Well, if you were on the jury, would you want to give a lot of money to the snooty accountant? Wouldn’t you be more inclined to give more to the nice homemaker and the nervous postal worker?

. Pre-existing injury

Suppose we add to the mix, that the postal worker has had a pre-existing back injury. He was treated about three years ago for back and shoulder pain caused by carrying a postal bag for years. Nine months ago, the postal service allowed him to start driving a postal truck so he doesn’t have to carry the bag. He says his back has been fine for about 6 months now. Will this change his award for pain and suffering? Possibly. The jury may believe that his old injury was aggravated and he’s had more pain as a result, making them want to give him a greater award. Alternatively, they may believe that he wasn’t that injured on the bus-this is just his old back pain that never went away, causing them to want to give him less. He and his attorney will need to convince them of the first scenario to come away with a higher award.

. Medical Treatment

The homemaker went to a chiropractor three times a week for treatment for three months following the accident and the chiropractor wants her to continue coming once a week for maintenance for another three months. The postal worker went to his HMO doctor once and was told to use ice and heat and take ibuprofen for one week. The accountant went to an orthopedist, had x-rays, saw a physical therapist twice and was done. Does the medical treatment received have an impact on pain and suffering awards or settlements? You bet! If the amount and type of treatment appears to be reasonable and necessary for the injury, the injured party comes across as much more honest to the jury. More or less treatment does not necessarily mean more money for pain and suffering, but it’s definitely another factor that is considered. Of course, running up the bills unnecessarily is looked at with a fair degree of suspicion. Stretching out treatment for a minor injury may look like greed to a jury and certainly to an insurance company.

Again, all of these factors, working alone, or in concert, create a picture for the jury and the insurance company that will have an impact on the monetary compensation for pain and suffering in one way or another. All that being said, the amount of dollars awarded for pain and suffering are not just pulled out of a hat. There are some tools that insurance companies and lawyers may use to help them arrive at a figure or at least a range for the purpose of determining how much to “demand” from the other party or how much to ask a jury to award. There are reports of past jury verdicts in virtually all states that can be reviewed to determine if there is a case with similar circumstances and/or injuries and/or medical expenses. These publications can be used as a general guideline along with all of the factors discussed above to come to a fair evaluation of the case. Your experienced personal injury attorney will know how to assess the value of your pain and suffering–what factors to include and what resources to utilize.

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I’m writing a book about the very small town I grew up in and changing the names of the people involved. Can I be sued for libel?

Writing Book Names Libel And Slander

I’m writing a book about the very small town I grew up in and changing the names of the people involved. Can I be sued for libel?

If it’s the truth, no. But to avoid a defamation lawsuit in the first place, change as many details as you can. For example, it does not fool anyone if the fictional character matches the real person in every respect except that his name is “Jones” instead of “Smith.” That could still harm Smith’s reputation and he may have grounds to sue. Use your creative license and change the hair, lifestyle, even the gender of the character. Many authors also combine characteristics (making a “composite character”), which often serves dramatic ends as well. You may protect yourself further by placing the familiar disclaimer at the beginning of your manuscript: “The people and events have been changed to protect the innocent, and any similarities to actual persons, either living or dead, are merely coincidental.” What also may help is that in most jurisdictions you cannot defame the dead. A sufficiently historical piece may allow you more freedom to write the scintillating details. Of course, if you are writing a nonfiction expose, you have the opposite burden–to make every statement truthful and accurate.

It may not hurt to consult with an experienced libel and slander attorney if you are not sure about the relative risks involved in your literary undertaking.

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What are the main deal points in an agency agreement?

Agency Agreement Music Law Intellectual Property

What are the main deal points in an agency agreement?

Each union has its own pre-printed “form” agency agreement, providing all of that unions particular requirements. These form contracts are lengthy and complicated. They are basically a stack of union forms combined into one “agency agreement”. A union agency agreement is actually comprised of eight contracts incorporated into one; one from AF of M (for musicians); one from AFTRA (for vocalists and taped or live televisions actors and actresses); three SAG agreements (one each for TV, film, and commercials); one for Equity; and two catch-all agreements called “General Service” and “Packaging”.

Some tips on negotiating terms in an agency agreement include:

(1) General Terms: Before singing any agency agreement, be clear with the agent on what genre of music you play, what sorts of other music you can play in a pinch, and what styles of music you are unable or unwilling to play. You should clarify if you are willing to work in venues only at night due to bandmember commitments, and whether you are willing to travel and how far. You may also need to reach an agreement of the prices the band will charge.

(2) Exclusivity: Most agencies will want to be your only (exclusive) booking agent, at least in a specified territory.

(3) Term: The “term” means the length of the contract. Agents like to ask for three (3) or more years. If you are artist with sufficient bargaining power, try to get them to limit it to one (1) year. If you cannot get this, try to get a clause allowing you to terminate after each year if the Agent fails to generate certain minimum levels of earnings.

(4) Territory: Talent Agents usually require “worldwide” rights. As a new artist, you may not able to avoid this. Once you become a mid-level artist, you may ask to exclude territories outside the US.

(5) Fees: Never give your booking agent a percentage of your income from records, song writing, or publishing. The “form” agency agreements from AF of M and AFTRA have a place on the form where you can initial if the agency commissions your earnings from your records. Do not consent to this. Instead, give them 5% to 10% of the personal appearances, depending on the employment procured. Sometimes, agents will reduce their percentage from 10% to 5% for artists that also generate major revenues from concerts. For TV, films, and radio, agents usually do not accept less than 10%. Sometimes, a sliding scale fee can be negotiated, which means as your income goes up, their fee goes down.

(6) Scope: Despite the fact that agency agreements are usually on pre-printed forms, there are a number of exclusions from your earnings that an artist should try to negotiate. Try to exclude earnings from: record producing, records (mechanical royalties), song writing (performance, synchronization and print income), sound tracks (even if they got you work as an actor or actress), commercials (unless your under contract for them), book publishing, and costs of collection. Try to avoid the agency from being able to get you employment in these areas without your written consent.

(7) Key Person: In order to ensure that the Talent Agent you hired stays your agent, even if he or she leaves the agency company, it is advisable to insert a “key man” clause in your agency contract. This clause provides that the “key person” with whom you have a agency relationship must be living and be actively and personally involved as your agent and, if not, you can terminate your agency agreement.

(8) Termination: In your union agency “form” agreement, make sure it contains a provision allowing the artist to terminate the contract if a specified amount of work has not been obtained in a certain time period. Make sure you also insert a clause that says that if any of the eight union forms contracts are terminated, you have the right to terminate the rest. If this is not done, the Agency may be representing you in certain areas, but not in others. If you cannot negotiate this escape clause, then try to at least get the Agent to agree that if either the AF of M or AFTRA agreements can be terminated for failure to secure employment, then you have the right to terminate all other contracts (called a “co-terminus” clause). In case the artist/agency agreement terminates during a tour, the agency will try to get paid commissions for all tour dates procured, so try to insert a clause that indicates that no commissions are paid for non-appearances beyond your control.

(Reprinted with permission of Ruben Salazar, Esq.)

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Our band is somewhat loosey-goosey. One member dropped out, formed a competing band using the same name. Since we use the name in our gigs, he can’t. Right?

No Agreement Music Law Intellectual Property

Our band is somewhat loosey-goosey. One member dropped out, formed a competing band using the same name. Since we use the name in our gigs, he can’t. Right?

If there is no band agreement and the arrangement is informal, the right to the band name customarily stays with the band. Without a formal contract specifying who owns the band’s name, a member who is kicked out may form a new competing band with the same name. Once a band name dispute arises from an informal arrangement, a lawsuit must be filed for a court to determine who used the name first and which members were in the band when its names gained a “secondary meaning” (i.e., the public began recognizing the band by its name). If it can be proven that certain members were identified by the public as being in the band, the court can bar the use of band’s name by another individual or other competing group. To determine ownership, a court will inquire into who has artistic control over the band and for how long.

Under the “control” test, if none of band members have belonged to the band long enough, taken sufficient creative control, or written and produced a significant portion of the band’s songs, the right to a band’s name could very well belong to a producer or manager that has done so. The name of band may also be voluntarily assigned to a producer or manager. However, if such a non-member owns the band’s name, he/she may only validly transfer the name if the original groups’ style and “good will” is retained in any newly formed group.

(Reprinted with permission of Ruben Salazar, Esq.)

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