Legal Definitions - collateral-benefit rule

The collateral-benefit rule is a legal principle that is also known as the collateral-source rule. This rule states that if a plaintiff receives compensation or benefits from a source other than the defendant, such as insurance or government assistance, the defendant cannot use that as a defense to reduce the damages awarded to the plaintiff.

For example, if a person is injured in a car accident and receives medical treatment that is paid for by their health insurance, the defendant cannot argue that they should not have to pay for those medical expenses because the plaintiff already received compensation from their insurance company.

Another example would be if a person is injured on the job and receives workers' compensation benefits, the defendant cannot argue that they should not have to pay for the plaintiff's lost wages because they are already receiving compensation from their employer.

These examples illustrate how the collateral-benefit rule protects plaintiffs from having their damages reduced simply because they received compensation from another source. This rule ensures that defendants are held responsible for the full extent of the damages they caused, regardless of any other compensation the plaintiff may have received.