In Japan, victims (被害者 or “higaisha”) of traffic accidents (交通事故 or “kotsu jiko”) are entitled to claim damages compensation (損害賠償 or “songai baisho”) from the responsible party in the accident for committing a tort, and directly claim an insurance payout from the insurance company (保険会社 or “hoken gaisha”) that the responsible party was enrolled in at the time of the accident.
These two types of claims will arise from the same traffic accident, and the content of the claim does not change based on who the damages compensation claim is being made against.
Damages claims for traffic accidents are generally divided into the types described below. When a settlement (示談 or “jidan”) is reached for damages caused by a traffic accident, the term “settlement money” (示談金 or “jidankin”) is sometimes used, however this “settlement money” actually refers to the total combined amount of each item below that is payable to the victim. As the term refers to the total amount combined, there is no specific damages claim type referred to as “settlement money”.
If repairing the property damage is appropriate, an amount equivalent to the cost of reasonable repairs will be allowed.
Registration Procedures and Fees
The amount equivalent to the costs required for vehicle replacement, namely registration costs, parking space certification, the legal fees for vehicle scrapping, the portion of the dealer’s fees (registration fees, parking space certification fees, delivery fees, vehicle scrapping fees), in addition to vehicle acquisition taxes, will be recognized as damages.
The premiums for the mandatory liability insurance (自賠責保険料 or “jibaiseki hokenryo”) for the vehicle involved in the accident, and the vehicle taxes, automobile weight tax, and mandatory liability insurance premiums for the newly acquired vehicle will not be recognized as damages.
However, the unexpired portion of the automobile weight tax for the vehicle involved in the accident (excluding the portion that has been refunded after the vehicle has been properly dismantled and registered for permanent cancellation in accordance with the Act on Recycling of End-of-Life Automobiles) will be recognized as damages.
In cases where the vehicle has been repaired but there remains a deterioration to the vehicle’s appearance or a loss of function, or due to having an accident history, the value (商品価値 or “shohin kachi”) of the vehicle is expected to decrease, an amount equivalent to the loss of value will be recognized as damages.
Vehicle Rental Fees
In cases where a substitute vehicle (代車 or “daisha”) is rented for a reasonable period of time whilst the damaged vehicle is being replaced or repaired, the rental fees will be recognized as damages. The repair period is usually one to two weeks but may be extended if it is necessary to procure specific parts or register the vehicle for business use.
Vehicle Downtime Losses
If the vehicle damaged is for business use (営業車 or “eigyosha”) (a green number plate etc.), an equivalent amount of damages will be recognized for the repair or replacement period, but generally, no consolation money (慰謝料 or “isharyo”) will be payable.
Medical Treatment Expenses
The full amount of actual medical expenses that are reasonable and necessary will be recognized as damages. However, if the medical expenses claimed are unreasonable or not necessary, it is possible that compensation will be denied on the grounds of excessive or overly expensive medical treatment.
Excessive medical treatment (過剰診療 or “kajo shinryo”) refers to medical treatment that is neither medically necessary nor reasonable.
Overly expensive medical treatment (高額診療 or “Kogaku shinryo”) refers to medical treatment that is significantly more expensive than the regular cost of such medical treatment in society in general, even though there is no particular reason for such level of expense.
Hospital Attendant Expenses
In cases where a hospital attendant (通院付添 or “tsuin tsukisoi”) is required based on the symptoms incurred, or the victim being an infant, an amount equivalent to the expenses will be recognized as damages for the victim.
In cases where transportation is required based on the symptoms incurred, or the victim being an infant, an amount equivalent to the expenses (交通費 or “kotsuhi”) will be recognized as damages for the victim.
Loss of Earnings
Provided that the necessity of absence from work and the causal relationship with the traffic accident is recognized, the loss of actual income (収入 or “shunyu”) incurred by the victim as a result of their injuries (受傷 or “jusho”), based on their pre-accident income, will be recognized as damages.
Even in cases where there is no actual loss of income, the use of paid annual leave (有給休暇 or “yukyu kyuka”) by the victim will be recognized as loss of earnings damages.
It is possible for loss of earnings damages to be recognized for victims that are part-time workers (アルバイト or “arubaito” or homemakers (主婦 or “shufu”), however if the victim was unemployed at the time of the accident, loss of earnings damages will not be recognized unless it is probable that the victim had both the desire and ability to work.
Hospital Admission Consolation Money
As a general rule, consolation money for the period of hospitalization for the victim will be recognized.
If the period of hospitalization is prolonged or visitations are irregular, the actual number of hospitalization days multiplied by 3.5 may be used as the basis for calculation of the consolation money.
Permanent Disability Consolation Money
Consolation money for permanent disability (後遺障害 or “koi shogai”) will be recognized based on the certified (認定 or “nintei”) severity (等級 or “tokyu”) of the disability.
Permanent Disability Loss of Profits
Loss of profits (逸失利益 or “isshitsu rieki”) due to permanent disability refers to profits that were expected to be earned in the future but can no longer be earned due to a partial loss of working capacity as a result of the permanent disability.
Loss of profits due to permanent disability will be recognized for the amount obtained by multiplying the basic income by working capacity and the period of incapacity to work and deducting interim interest.
In addition to the other categories of damages described, victims of traffic accidents may also claim the following damages when hospitalized (入院 or “nyuin”) as a result of the accident.
Hospital Attendant Expenses
If it is considered necessary based on doctor orders, the severity of the injury incurred in the traffic accident, the advanced age of the victim and so on, the actual expenses for a professional hospital attendant, and equivalent expenses for a next of kin (近親者 or “kinshinsha”) attendant will be recognized as damages for the victim.
Hospital Miscellaneous Expenses
Miscellaneous expenses incurred during hospitalization will be recognized as damages on a per day basis.
Fatal Traffic Accident Damages
If the victim in a traffic accident in Japan dies, the damages compensation system operates as follows.
Funeral expenses refer to the expenses involved in conducting a funeral for a victim of a traffic accident. Expenses for the wake, altar, cremation, gravestone and the like will be recognized as damages to the extent such expenses are normally required.
Death Loss of Profits
Loss of profits due to death refers to profits that were expected to be earned in the future but can no longer be earned due to death as a result of the traffic accident.
Damages for loss of profits due to death is similar to damages for loss of profits due to permanent disability in that it is calculated by multiplying the basic income by working capacity and the period of incapacity and deducting interim interest. However, a certain percentage will be deducted from this figure for living expenses the victim would have needed to incur had they not died in the accident.
Depending on matters to be taken into consideration, these amounts may change, but the following figures provide a guideline for consolation money payments.
|Main provider for family||28,000,000 JPY|
The amounts provided above are the total consolation money payments for fatal traffic accidents and include consolation money payments specific to the next of kin for the victim.