Even though there is general consensus that pain and suffering damages for personal injuries should primarily be based on the severity and duration of the impairment to health, the amounts granted differ greatly between and within countries. There is no legal framework to assess the correctness of the damages because a yardstick is lacking. The authors argue that the concept of Quality Adjusted Life Years (QALYs) from the field of health economics is able to provide the required framework. The primary legal objective of damages is to restore the victim as closely as possible to the position he would have been in without the accident. Besides compensation, satisfaction and prevention are also regularly mentioned as goals of pain and suffering damages. Whatever the goal, the authors' view is that pain and suffering damages must be based on the impact of the health impairment on the victim. The concept of QALYs allows pain and suffering damages to be based on the impact of the health impairment. A QALY expresses the value of living one year in a certain health condition. The health economics literature allows an assessment of the impact of different health conditions on quality of life. By subsequently monetizing QALYs, this impact is expressed in monetary terms, which provides a systematic basis for pain and suffering damages. The authors compare pain and suffering damages in several European countries with the amounts that would result from a conservative estimate of the monetary value of a QALY for specific types of personal injuries. They show that the amounts that are currently awarded are too low when compared to this assessment of the impact of the injury on quality of life.(2010) 1 JETL 48

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Even though there is general consensus that pain and suffering damages for personal injuries should primarily be based on the severity and duration of the impairment to health, the amounts granted differ greatly between and within countries. There is no legal framework to assess the correctness of the damages because a yardstick is lacking. The authors argue that the concept of Quality Adjusted Life Years (QALYs) from the field of health economics is able to provide the required framework. The primary legal objective of damages is to restore the victim as closely as possible to the position he would have been in without the accident. Besides compensation, satisfaction and prevention are also regularly mentioned as goals of pain and suffering damages. Whatever the goal, the authors' view is that pain and suffering damages must be based on the impact of the health impairment on the victim. The concept of QALYs allows pain and suffering damages to be based on the impact of the health impairment. A QALY expresses the value of living one year in a certain health condition. The health economics literature allows an assessment of the impact of different health conditions on quality of life. By subsequently monetizing QALYs, this impact is expressed in monetary terms, which provides a systematic basis for pain and suffering damages. The authors compare pain and suffering damages in several European countries with the amounts that would result from a conservative estimate of the monetary value of a QALY for specific types of personal injuries. They show that the amounts that are currently awarded are too low when compared to this assessment of the impact of the injury on quality of life. * Vaia Karapanou is a PhD student in the European Doctorate in Law and Economics (EDLE) and is attached to the Rotterdam Institute of Law and Economics (RILE) of the Erasmus School of Law; Louis Visscher is Associate Professor in Law and Economics at RILE. 1 We exclude fatal accidents from our analysis, because this requires different economic concepts (the so-called value of a statistical life and value of a statistical life year) than that applied in this paper.

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