Los Angeles Claims Adjuster Property and Causality Practice Exam

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What type of damages are awarded to an injured party for economic losses such as medical expenses and lost wages?

Punitive Damages
Compensatory Damages
General Damages
Vicarious Damages

The correct answer is: Compensatory Damages

Compensatory damages are specifically designed to reimburse the injured party for actual economic losses that they have incurred due to an injury or wrongdoing. These damages cover quantifiable financial losses such as medical expenses, lost wages, property damage, and other out-of-pocket costs that arise as a direct result of the incident. In the context of a personal injury case, the goal of compensatory damages is to restore the injured party to the financial position they would have been in had the incident not occurred. This includes covering both past and future expenses related to the injury, ensuring that the individual is not left with a financial burden resulting from the responsible party's actions. Other types of damages, such as punitive damages, are meant to punish the wrongdoer and deter similar conduct in the future rather than to compensate the victim for their losses. General damages, while related to non-economic losses (like pain and suffering), do not provide compensation for actual financial expenditures. Vicarious damages are not a recognized category of damages and do not apply in this context. Thus, for economic losses, the appropriate category is compensatory damages.