Aside from the emotional pain, when someone dies in an accident, families are often left facing overwhelming financial burdens—medical bills, funeral expenses, and the sudden loss of income. In these situations, a wrongful death settlement may provide much-needed relief and accountability. Working with experienced wrongful death attorneys is essential for navigating the legal process and ensuring your family receives fair compensation.
In this article, we’ll explain what families in California should expect when pursuing a wrongful death settlement, including average settlement amounts, payout methods, tax implications, and how long the process may take.
If you’re already facing such an unfortunate situation and seeking compensation for your loved one, please call Megeredchian Law at (866) 359-0807. We’ll evaluate your case in a matter of minutes, determine whether you qualify for compensation, and assign you an experienced attorney to handle your case.
What Is a Wrongful Death Settlement?
A wrongful death settlement is a legal agreement reached outside of trial between the responsible party (or their insurer) and the surviving family members of the deceased. Instead of leaving the decision in the hands of a jury, both parties agree to compensation that reflects the losses caused by the wrongful death.
Under California law, eligible parties who may file for wrongful death include:
- Surviving spouses or domestic partners
- Children of the deceased
- Parents or other financial dependents, in some circumstances
Damages available in wrongful death settlements typically cover:
- Medical expenses prior to death
- Funeral and burial costs
- Loss of the deceased’s future income and benefits
- Loss of companionship, guidance, and emotional support
Average Wrongful Death Settlement in California
One of the most common questions families have is: “What is the average wrongful death settlement?” While there is no universal figure, industry data suggests that settlements often range from hundreds of thousands to several million dollars depending on the circumstances.
The average wrongful death settlement varies widely because each case depends on:
- Age and health of the deceased: Younger victims with high earning potential may result in higher settlements.
- Financial contribution: The more the deceased provided for their family financially, the greater the potential damages.
- Strength of liability evidence: Clear proof of negligence usually results in stronger settlements.
- Insurance policy limits: Compensation may be limited if the defendant’s insurance coverage is capped.
It’s important to understand that averages can be misleading—each case is unique. Families should work with skilled attorneys to calculate the true value of their losses.
How Wrongful Death Settlements Are Paid Out
Another frequent question is: “How are wrongful death settlements paid out?”
In California, settlements are generally distributed in one of two ways:
Lump-Sum Payment
- Families receive the entire settlement amount in one payment.
- Advantage: immediate access to funds for expenses like medical bills, mortgage payments, and tuition.
- Drawback: without careful financial planning, large lump sums can be difficult to manage long-term.
Structured Settlement
- Payments are spread out over a set schedule, sometimes for decades.
- Advantage: provides reliable, long-term financial security.
- Drawback: less flexibility for urgent, large expenses.
The best option depends on a family’s financial situation and long-term needs.
Are Wrongful Death Settlements Taxable?
Families also ask: “Are wrongful death settlements taxable?” or “Is a wrongful death settlement considered income?”
In most cases, wrongful death settlements are not taxable. The Internal Revenue Service (IRS) generally does not tax compensatory damages related to physical injury or death. That means the portion of the settlement covering medical bills, funeral expenses, lost income, and emotional suffering is usually exempt from federal taxes.
However, there are important exceptions:
- Punitive damages: If the settlement includes punitive damages meant to punish the defendant, that portion may be taxable.
- Interest: If the settlement accrues interest (for example, during delayed payment), that interest may also be subject to tax.
Thus, while most wrongful death settlements are not considered ordinary income, it is wise to consult both an attorney and a tax professional to ensure compliance with California and federal tax rules.
How Long Does a Wrongful Death Settlement Take?
Another critical question is: “How long does a wrongful death settlement take?”
The timeline depends on several factors:
- Liability disputes: If the defendant’s insurance company disputes fault, negotiations may take months or even years.
- Number of beneficiaries: When multiple family members are involved, dividing compensation can take additional time.
- Court involvement: While most cases settle out of court, lawsuits that proceed to trial may take significantly longer.
- Settlement negotiations: Insurance companies often attempt to delay or minimize payouts, prolonging the process.
On average, wrongful death cases in California may take anywhere from several months to two years. Settlements are typically faster than jury verdicts, but the timeline varies based on case complexity.
Factors That Influence the Settlement Amount
The value of a wrongful death settlement is shaped by both economic and non-economic damages:
Economic Damages
- Funeral and burial costs
- Medical expenses prior to death
- Lost future income and benefits
- Household services once provided by the deceased
Non-Economic Damages
- Emotional suffering
- Loss of companionship, guidance, and consortium
- Impact on surviving children or dependents
Additionally, the defendant’s financial ability to pay plays a role. If the at-fault party is uninsured or underinsured, families may face challenges in securing full compensation.
Steps to Protect Your Right to a Fair Settlement
Maximizing your settlement requires proactive steps:
- Hire Experienced Attorneys: Skilled legal representation ensures your claim is valued correctly and that insurance companies don’t take advantage of your grief.
- Collect Evidence: Police reports, medical records, and expert testimony help establish liability and damages.
- Negotiate Strategically: Attorneys know when to push for higher offers and when to consider settlement.
- Prepare for Trial if Necessary: Even though most cases settle, the threat of trial often motivates insurers to make fairer offers.
What Families Should Expect
Pursuing a wrongful death settlement in California is a difficult but necessary step for many families. While no amount of money can replace a loved one, compensation can provide financial security and a sense of justice.
Remember:
- The average wrongful death settlement varies depending on many case-specific factors.
- Settlements may be paid out as lump sums or structured payments.
- In most cases, wrongful death settlements are not taxable, but exceptions apply.
- The process may take months or years depending on disputes and complexity.
- Working with experienced attorneys is crucial to protecting your rights.
If your family is facing the aftermath of a wrongful death, you don’t have to navigate this process alone. Experienced wrongful death attorneys can help you understand the true value of your claim, guide you through negotiations, and fight for the justice your loved one deserves. Call Megeredchian Law at (866) 359-0807 for a free case evaluation.