Economic damages: the documented, countable losses
Economic damages are the straightforward, receipt-backed part of a claim. In a Michigan personal injury case, this generally includes medical expenses already incurred, lost wages from time away from work, property damage, and reasonably anticipated future medical care or lost earning capacity tied directly to the injury.
Non-economic damages: the subjective losses
Non-economic damages cover the losses that don't come with a receipt: pain, suffering, inconvenience, physical impairment or disfigurement, and loss of society and companionship. These are inherently harder to quantify, which is exactly why the multiplier method exists — to translate a documented economic figure into a reasoned estimate of the non-economic side.
Why this split is the whole story at 51% fault in Michigan
Under MCL 600.2959, crossing 50% fault bars noneconomic damages completely — but has no such effect on economic damages, which are simply reduced by the fault percentage and keep being paid regardless of how high that percentage climbs. In most other 51%-bar states, crossing the line ends the whole claim; in Michigan, it only ends half of it. Getting this split right, and documenting the economic side thoroughly, is what keeps a claim alive even when fault allocation goes badly.
The same split drives the medical malpractice cap
MCL 600.1483's two-tier cap applies only to the noneconomic category in a malpractice claim. Economic damages — medical bills, lost wages, future care — pass through completely uncapped, so a thorough economic damages record matters even more once the noneconomic side has maxed out.
And the auto no-fault threshold is specifically a noneconomic gate
Michigan's "serious impairment of body function" threshold under MCL 500.3135 determines whether a car accident claim can pursue noneconomic damages at all through a third-party lawsuit. It has nothing to do with economic damages, which are handled through the no-fault PIP benefits system regardless of whether that threshold is met.