Civil Damages
What Does Civil Damages Mean?
Civil damages are monetary awards given to a plaintiff in a civil suit when they prevail in their case.
In the context of insurance, policyholders may sue insurance companies if they believe the insurer has caused them financial harm. If the plaintiff succeeds in their case, they are typically awarded civil damages.
Insuranceopedia Explains Civil Damages
Civil damages can vary significantly from case to case. Depending on the extent of the loss, the defendant’s degree of responsibility, and legal precedents, the plaintiff may be awarded anything from a few thousand dollars to tens of millions.
Civil damages also come into play on the other side of the policy. If a policyholder causes bodily injury or property damage to someone else, that person can file a civil suit against them. This is one of the reasons it is worth knowing how much liability insurance you actually need, since a damage award that exceeds your policy limits comes out of your own pocket.
A policyholder may choose to sue their insurer if they have incurred a loss that they believe should have been covered by their insurance policy, but the insurer denies the claim. In such cases, the plaintiff bears the burden of proof to demonstrate that they should be awarded damages for the denied claim.
Businesses face civil damage claims more frequently than individuals do, which is why most commercial policies include general liability insurance to cover legal defense costs and any resulting settlements or judgments.
