Household services analysis applied to motor vehicle accident litigation: methodology, deliverables, and case-specific considerations.
Motor vehicle accident claims produce household services losses ranging from a few months of replaced tasks during recovery to a permanent reduction after a catastrophic injury. The economist measures the hours the person could not perform during recovery from the household's account and time-use data, values them at replacement cost, and, where the injury leaves a permanent limitation, apportions the ongoing loss by category and projects it over the person's expected life with growth and discounting. The report presents the recovery period and the permanent loss separately so the same analysis serves settlement evaluation and trial.
Replacement-cost valuation of the household production an injured or deceased person can no longer provide: meal preparation, cleaning, home and vehicle maintenance, shopping, child care, and care of other household members. The hours are drawn from national time-use data adjusted to the person's household composition and pre-injury role, and each category is priced at the local wage for the occupation that would replace it, then projected and discounted over the period of loss.
The claim is made up of past lost earnings while the person was out of work, future lost earnings or reduced earning capacity where the injury limits the work the person can return to, lost fringe benefits, the replacement cost of household services during recovery and afterward, and the present value of future care costs when a life care plan or treating recommendations exist. For a fatal crash the analysis becomes a wrongful death loss to the survivors. The drivers are the earnings and benefit history, the employer's records on the period out of work and any accommodation, and the medical and work-capacity opinions in the record.
We issue the final report and provide deposition and trial testimony and rebuttal of opposing household services opinions.
From the medical record and the household's account: the date of injury, the restrictions in place during treatment, and the date the person resumed each category of household work. The hours are valued over that period at the local replacement wage.
The claim measures the injured person's lost hours at the cost of replacing them with paid services, whoever actually performed the work. A spouse or family member taking on the tasks does not reduce the loss; it shows what was replaced and by whom.
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