Fatal Accident Earnings Dependency

Fatal Accident Earnings Dependency: How Your Solicitor Calculates The Amount A Partner And Children Can Claim Following Death Of The Main Income Earner

Fatal Accident Earnings Dependency Calculations: Find out what a fatal accident earnings dependency claim is; who are classed as financial dependants; how the amounts of compensation are calculated by your solicitor annually and in total; free specialist solicitor help when you have lost a loved one.

What is a fatal accident earnings dependency claim?

When a fatal accident occurs to someone who had paid employment or other source of income or earnings – if you were an individual who was financially dependent on that income, you will undoubtedly suffer financial hardship & loss.

If the death was caused due to the fault of another – it is proper that you be compensated for this hardship.

A fatal accident earnings dependency claim is therefore a sum to be included in the overall fatal accident compensation claim following death based upon loss of income support and contribution from an earnings provider.

Please note – an earnings dependency claim is one aspect of a fatal accident claim – others include bereavement loss, funeral expenses. See our detailed fatal accident compensation article for further details.

Who are financial dependants who might be entitled to claim compensation?

Financial dependent individuals might include – a spouse, a partner or children (sometimes even parents or extended family members might be dependent).

How is the annual amount of compensation for fatal accident earnings dependency calculated?

Firstly – it should be noted that the amount of compensation claimed for fatal accident earnings dependency can never be more than the total income earned by the deceased at the time of death.

There are two primary methods fatal accident earnings dependency can be calculated, which include:

Records of money coming in and going out

If records are available showing how the deceased’s income was used – this can be used as evidence to show what the fatal accident earnings dependency loss was.

The apportionment principle to calculate fatal accident earnings dependency

This apportionment principle approach applies slightly differently depending on whether the dependent was part of a couple without children or whether children were also involved.

Consider two different examples:

Husband is killed in a fatal accident leaving a dependant wife who was only working part time

Consider the net income for the couple (included in this is the surviving wife’s earnings) – net income of deceased husband at time of death plus net income of wife are added together.

The expenditure of the couple’s income is considered as though it were divided into 3 equal pots (each a third of the total net couple’s income).

Pot 1 – the proportion of money the late husband kept for himself.

Pot 2 – the portion of income used on joint expenditure of the couple.

Pot 3 – the portion of earnings used to support his wife.

The fatal accident earnings dependency calculation allows the surviving wife to claim the part that was used for her (pot 3) and joint part (pot 2). Therefore, the widow’s claim is for 66% (two thirds) of household combined income.

Watch out – from the overall figure of 66% is deducted the net income received by the wife from her part time work.

The remaining final figure is the annual sum that can be claimed by the widow – technically known as the multiplicand.

Husband is killed in a fatal accident leaving a dependant wife who is not working and dependant children

As children are involved the first consideration is how long they would have been dependent. In England and Wales – a child turns into an adult at the age of 18 and at that stage it is be expected that the children would earn their own income. There will however be considerations of the likelihood of further education and continued dependency during those periods.

Now when there is a partner and children – there are considered to be 4 pots (each a quarter) of the husband’s net income:

Pot 1 – the proportion of money the late husband kept for himself.

Pot 2 – the portion of income used on joint expenditure of the couple.

Pot 3 – the portion of earnings used to support his wife.

Pot 4 – the portion used for the children.

Here the annual sum that can be claimed as fatal accident earnings dependency is 75% being pot 2, pot 3 and pot 4.

As the deceased husband was the only family member earning income – the annual sum for fatal accident earnings dependency would be 75% of his annual net income. If his wife had been earning her income be deducted from the 75% total.

In summary – If one person earning then apply percentage 66% for couple and 75% for family to late husband’s net income and if two people earning then the same percentage of 66% for couple and 75% for a family applies but now deduct the survivor’s whole income to give the net annual sum.

How is the total fatal accident earnings dependency calculated?

The annual sum is known as the multiplicand and the number of years you can have is known as the multiplier.

A recent case known as Knauer – v – Ministry Of justice determined that the multiplier started from the date of trial.

The time period between the date of death and the date of trial is an exact time period known as the term certain.

A fatal accident earnings dependency would therefore equal the term certain multiplied by the annual sum plus the multiplier times the annual sum.

For example – if it took two years between death and trial, you would received 2 x annual sum plus the annual sum x the multiplier.

The multiplier itself (the number of times that the annual sum should be received after trial) is calculated based upon certain tables that calculate life expectancy with a significant adjustment for early receipt of compensation monies early – on the presumption that these sums can be invested or saved and accumulate in worth during this time.

What should you do if you believe you could have a fatal accident earnings dependency claim?

Remember – even if you were not dependent on a loved one there are a number of other types of compensation you can claim following death.

The calculations of fatal accident earnings dependency compensation amounts is very complex – as are including all the types of compensation you could claim following a fatal accident.

You should speak to a specialist solicitor as soon as possible to assess your claim end ensure you do not delay too long and lose the right to claim due to the statutory limitation period.

We offer specialist fatal accident solicitor free online / telephone help with fatal accident compensation claims.