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How are Wrongful Death Settlements Paid Out?

How are Wrongful Death Settlements Paid Out?

Wrongful death lawsuits may occur as a result of auto accidents, workplace accidents, medical malpractice, product liability and much more. The damages that can be compensated in a New York wrongful death lawsuit include medical expenses, lost wages, lost benefits, funeral costs and loss of inheritance.

Compensation can also include the reasonable value of earnings lost between the time of an initial injury to the deceased and the time of death. If a spouse remarries, this will not reduce the award. Children of the deceased may receive additional compensation for the loss of parental nurturing, guidance and education (New York City Bar).

There may also be damages available to those in the “zone of danger” of an accident. For example, if a family member is in the car accident that causes the death of a close relative, even if the survivor is not physically injured.

Lawyers experienced with wrongful death cases are often able to negotiate a settlement before wrongful death cases reach the trial level. Most wrongful death cases are settled out of court.

Each state has different laws surrounding the distribution of a settlement. In New York, damages that address pecuniary loss (financial loss) are distributed to immediate family members. Pecuniary loss is defined by NY Code – Part 4: Rights of Members of Family Resulting from Wrongful Act, Neglect or Default Causing Death of Decedent.

Damages are distributed to those eligible to recover under intestate law, in proportion to their financial loss, except that when there is a surviving spouse and parents, but no children or grandchildren, the parents will also recover in proportion to their pecuniary loss. (N.Y. Estate Powers & Trusts Law § 5-4.4)

A surviving spouse and small children who were financially dependent on the deceased person will get a larger share than adult children who were financially independent.

The priority for the distribution of proceeds from a wrongful death settlement in New York is as follows:

  1. A spouse and no children: the entire amount goes to the spouse.
  2. A spouse and children: $50,000 and half of the balance of the estate to the spouse, and the remaining amount is divided equally among the children who are in the same generation.
  3. Children and no spouse: the whole amount goes to the children and is divided equally among them as long as they are in the same generation.
  4. One or both parents and no spouse and no children: the whole amount goes to the surviving parent or parents.
  5. Parent’s children (brothers, sisters, or their children) and no spouse, children or parent: the whole to the parent’s children (nephews and nieces) or other family members, divided equally among the members of the same generation.
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