When you’re injured and can’t work, it’s not just your physical health that takes a hit. Your income may also take a hit, which can seriously impact your quality of life. However, if you’ve been injured and cannot work, you may be able to collect compensation for loss of earning capacity.
What Exactly Is A Loss Of Earning Capacity?
Loss of earning capacity is typically defined as the inability to earn the same income as you did before an accident or injury. In many cases, insurance companies will use a formula to calculate the loss of earning capacity, considering factors such as age, education, and occupation. In some instances, insurance companies may also consider the impact of an injury on an individual’s ability to perform specific job-related tasks.
Impact Of Lost Earning Capacity On Future Income
The loss of earning capacity can significantly impact an individual’s future income. When an individual’s earning capacity is diminished, it can decrease future earnings potential. In turn, this can affect an individual’s ability to save for retirement, purchase a home, or provide for other financial goals.
Insurance policies often include provisions for lost earning capacity, which can help to offset the financial impact of this type of loss. While insurance cannot replace the lost earnings, it can help ease the financial burden and allow the policyholder to maintain their standard of living.
Proving Loss Of Earning Capacity
When insurance companies calculate your compensation for an on-the-job injury, one of the key factors they consider is your “loss of earning capacity.” To receive full benefits, you will need to prove that your injury has caused a significant reduction in your ability to earn a living.
There are a few different ways to do this. First, you can provide documentation from your employer showing a decrease in pay or hours since the accident. Alternatively, you can present expert testimony from a vocational rehabilitation counselor explaining how your injuries have impacted your ability to work. Finally, you can point to the fact that you can no longer perform the same type of work as before.
Proving loss of earning capacity can be tricky, but it is crucial if you want to receive full benefits for your injuries. By gathering the right proof and documentation, you can ensure that you receive the compensation you deserve.
