caps on damages

Caps on damages are limits set by law or agreements that restrict the amount of money a injured party can receive in a lawsuit. These caps are designed to control the financial burden on defendants, such as businesses or insurance companies, and prevent excessive payouts. For example, a damage cap might limit non-economic damages like pain and suffering to a certain dollar amount, even if actual suffering is greater. While they aim to promote fairness and predictability, caps can also limit the compensation available to those harmed.