Colorado is one of the states in the United States where the collateral source rule is a legal concept. It talks about the steps that are taken to decide how much money to give in tort situations.
As it does in many other places, the secondary source rule has important effects on personal injury cases in Colorado.
These effects are especially strong when it comes to insurance, medical care, and payments to third parties. The personal injury attorneys in Boulder at Purvis Thomson magnify the significance of understanding the history, aim, and use of Colorado’s secondary source rule in personal injury cases.
The Collateral Source Rule: What You Need to Know
The collateral source rule in a personal injury case states that the defendant cannot reduce their liability to the plaintiff by the value of compensation the plaintiff obtains from sources external to the defendant.
These kinds of unrelated sources are commonly referred to as “collateral sources,” and some examples of them include health insurance, disability compensation, and third-party donations from organizations such as governments and charities.
History of the Collateral Source Rule
The collateral source rule may be traced back to the 19th century and its beginnings in American common law. Its purpose was to shield plaintiffs who relied on aid or insurance obtained from other parties rather than the defendant.
The rule was put in place so that defendants couldn’t gain an advantage by knowing that a plaintiff has taken precautions to mitigate their financial exposure (such as by purchasing insurance).
Application in Colorado
Colorado abides by the collateral source rule, which states that the amount of money obtained from collateral sources is often not deducted from the damages granted to a plaintiff in a personal injury lawsuit.
Payments from non-defendant sources such as health insurance, disability benefits, workers’ compensation, Medicare, Medicaid, and so on are included. Here are some of the most important components of Colorado’s collateral source rule:
Evidence of Collateral Payments
In Colorado, the defendant is not permitted to use proof of collateral payments to decrease the amount of money owed to the plaintiff as a form of damages mitigation. These collateral payments are not relevant to the damages awarded, and the jury should not be told about them.
Exceptions
The collateral source rule has certain limited exceptions. The defense may be permitted to present evidence to refute the plaintiff’s allegations, such as when the plaintiff attempts to bring proof of collateral payments to substantiate their losses. However, the regulation still typically forbids decreasing the damage award in such circumstances.
Subrogation and Liens
Subrogation and liens are affected by Colorado’s use of the collateral source rule. The defendant may be held liable for subrogation damages if the plaintiff’s health insurer is entitled to reimbursement made on behalf of the plaintiff. However, this does not normally lessen the amount of damages awarded to the plaintiff.
Considerations and Implications
Protecting the injured party and upholding the idea that culprits should not profit from the injured person’s responsible activities, such as acquiring insurance or seeking aid from other sources, is the purpose of Colorado’s collateral source rule. It prevents the plaintiff’s damages from being reduced because of contributions from collateral sources and guarantees that the plaintiff is fairly reimbursed for their losses.
The collateral source rule is a long-standing concept of Colorado law that has a major bearing on the awarding of damages in personal injury cases. Recognizing the necessity of insurance and other financial safety nets aids in providing fair and equitable compensation to harmed parties.
The collateral source rule in Colorado is a legal notion meant to shield unlawfully damaged people from being punished for taking precautions like getting insurance or help from other parties. The rule protects the values of equity and justice in tort disputes by prohibiting defendants from offsetting damage judgments with any collateral compensation they may have received.
There are many law firms that have particular strength in personal injury litigation, with an emphasis on the collateral source rule. Younger lawyers will learn from more seasoned colleagues, and the whole team will work together to deliver excellent client service. Finding an experienced team of lawyers who are well-equipped to handle the unique challenges posed by modern insurance and healthcare systems, is one of the first steps when fighting your case.
