What Are Out-of-Pocket Expenses?

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What Are Out-of-Pocket Expenses?

When personal injury lawyers explain the types of compensation their clients recover, they usually talk about two categories: economic damages, which represent the financial costs of an accident, and non-economic damages, which represent the human costs.

Out-of-pocket expenses are a form of economic loss. They describe the costs you paid from your income or savings as a result of an accident. 

Economic Damages in a Personal Injury Claim

Economic Damages in a Personal Injury Claim

Economic losses are also called “special damages” because they’re unique to your case. You’ll also sometimes hear them described as “compensatory damages,” as they’re intended to compensate you for financial losses. 

They include all the expenses you incurred due to your injuries, such as:

  • Medical costs
  • Past income losses
  • Future income losses

But you can also look at these same losses in terms of who incurred them. Some illustrative examples include:

  • Surgery, mostly paid by your health insurance after you paid a copay
  • Missed paychecks, lost by you
  • Wheelchair rental, paid by you
  • Emergency room costs billed to you but not yet paid

Thus, out-of-pocket expenses include all the costs you’ve paid yourself, regardless of the reason.

Examples of Recoverable Out-of-Pocket Expenses

Assuming you can prove the other party’s negligence, you can be reimbursed for any expense deemed a reasonable and necessary consequence of your accident. “Necessary” means the expense was caused by your injuries; “reasonable” means you didn’t overpay.

These expenses include the costs of treatment, therapy, medication, and equipment. 

You can seek reimbursement for them regardless of whether:

  • You paid them as out-of-pocket expenses
  • Your health insurer paid them
  • You were billed for these expenses, and no one has paid them

Some recoverable expenses typically overlooked by accident victims include:

Medical Costs

You’ll bear many of the costs associated with your medical treatment, therapy, or medication. The reason is simple: most healthcare providers expect at least partial payment when they render services.

Fortunately, you can seek reimbursement for all medical costs you pay out of your pocket, including:

  • Copays
  • Deductibles
  • Medical device rentals or purchases
  • Over-the-counter medication costs
  • Expenses for medical supplies, such as medical tape or bandages

As long as these expenses were incurred due to the injuries resulting from your accident, they’ll likely meet the “reasonable and necessary” test.

Travel Expenses

If you need to travel to obtain medical care for your accident injuries, you can include the travel expenses with your economic losses. 

Some examples include:

  • Gas
  • Parking
  • Hotel
  • Taxi or rideshare fares

These expenses won’t qualify as reasonable and necessary if you have comparable healthcare options close to you — they typically only satisfy the test if you live in a rural area far from medical care or require a specialist not found in your area.

Home Modification Costs

Your injuries may temporarily or permanently disable you. If you pay to modify your home to accommodate your disabilities, you can also include those expenses in your personal injury claim

Some examples include:

  • Wheelchair ramps
  • Grab bars
  • Hospital beds

You don’t necessarily need to choose the cheapest option for an expense to be considered reasonable; it only needs to be reasonable under the circumstances. Just remember that if you go overboard, you might not receive full reimbursement for the expense.

For example, suppose you decide to install an elevator in your home so that you don’t need to go up and down the stairs. A jury or adjuster might only require the insurer to reimburse you for the cost of a ramp or stair lift, and you might get stuck with the difference.

Replacement Services Expenses

The most commonly overlooked out-of-pocket expense is probably the cost of replacement services. Disabling injuries might inhibit you from fulfilling your duties around your home or even prevent you from meeting your daily needs.

If you need to hire someone to perform certain tasks, you can include the cost with your economic losses. 

Such services may include:

  • Cooking
  • Cleaning
  • Childcare
  • Delivery services
  • Drivers

To meet the reasonable and necessary test, you’ll need to provide evidence that your disability arose from your accident and that you couldn’t perform the services yourself due to this disability.

Documenting Out-of-Pocket Expenses

Most accidents involve an insurance claim. If you were injured in a car accident in Tampa, you’d need to start with a no-fault claim with your auto insurer. Florida law excuses you from the no-fault system and allows you to pursue the at-fault driver if you suffered a significant, permanent injury, or your costs exceed your policy limit.

Whether you file a claim after a car accident, slip and fall, or medical malpractice incident, you need proof of your losses. Without proof, the insurer can’t pay you for the expenses you incurred.

You should always keep your receipts, credit card statements, and check stubs to document your out-of-pocket expenses.

Contact a Tampa Personal Injury Lawyer for Help Calculating Your Out-of-Pocket Expenses and Other Damages

Insurers often deny claims for out-of-pocket expenses. An injury lawyer from Winter & Yoker, P.A. can present evidence and legal arguments for why your out-of-pocket expenses qualify as economic losses eligible for compensation.

Contact a Tampa personal injury lawyer for a free consultation to discuss your accident and the out-of-pocket expenses you incurred as a result at (813) 223-6200. We have five convenient locations in Florida, including Tampa, Clearwater, St. Petersburg, New Port Richey, and Lakeland.