How the Collateral Source Rule Can Impact Your Settlement

In Illinois personal injury cases, the collateral source rule disallows evidence that plaintiffs recovered compensation for their losses from other parties, such as an insurance company. This rule helps protect plaintiffs from defendants who claim the individual has been overcompensated for their injuries.  

Collateral Source Rule in Illinois

Illinois law prevents the defendant in a personal injury case from introducing evidence that establishes the plaintiff received compensation from sources other than the defendant. It does not matter how much compensation was received, or whether the compensation covered the plaintiff’s expenses in full or in part. This includes compensation paid by insurance providers, government entities, charity, etc. The rule prohibits defendants from asking questions regarding this compensation, calling witnesses to testify how much was paid, or subpoenaing bank or other records of these payments.

However, the defendant in a personal injury case in Illinois can question the reasonableness of the plaintiff’s medical expenses. They may call witnesses to testify that the individual’s claimed medical expenses are above the reasonable value of similar services and treatments. This is why it is crucial to thoroughly document all billed medical, therapeutic, and pharmaceutical treatments administered or prescribed during the recovery period. In the end, the rule ensures that the responsible party is held accountable for the injuries and damages caused by their negligent actions.  

Challenges to the Collateral Source Rule

It is not uncommon for defendants to challenge the collateral source rule by claiming that it allows for double recovery of compensation. However, for more than 150 years, Illinois courts have repeatedly upheld the collateral source rule and the protections it provides to plaintiffs. As a result, the courts do not reduce the damages owed to victims for the injuries caused by the defendant’s actions regardless of the compensation the victim received other sources. 

Documenting Expenses

Thorough documentation and accurate accounting are essential when pursuing a personal injury claim in Illinois. Individuals must maintain an up-to-date accounting of their medical bills, surgical expenses, prescription costs, and therapeutic treatment programs. Similarly, plaintiffs should correctly account for lost wages, commuting expenses, and other costs. Maintaining receipts and records of payments made establishes a paper trail that is difficult to dispute in court. When opposing counsel questions the validity of these expenses, they provide solid evidence that establishes the legitimacy of the compensation pursued.