Workers’ compensation disability benefits are usually paid on a weekly basis. However, in some cases, insurers offer a lump sum settlement or are willing to negotiate a lump sum settlement. When a lump sum settlement is reached, you will receive benefits in a single payment, rather than in installments over time. Generally, it is not wise to accept a lump sum settlement if there is still a possibility that you will need medical care down the road. If you are considering accepting a lump sum settlement in your workers’ compensation case, you should talk to the Riverside and San Bernardino County workers’ compensation lawyers at the Law Office of Joseph Richards, P.C. about your situation.
Injured workers may wish to settle their claims for workers’ compensation through a lump sum settlement. These settlements usually incorporate the cost of future medical care or involve an agreement that the insurer will provide medical care for the rest of the worker’s life. In most cases, the lump sum is more than what an injured worker would have with weekly disability payments, but the extra amount supposed to cover future medical costs may be a compromise.
Whether you should accept a lump sum settlement turns on many factors. These factors include how much money you are offered, how contested your claim is, whether you are permanently limited by your work injury, how severe your injury is, your financial situation, and how long you are capable of waiting for the money, since workers’ compensation proceedings can take time. If you are offered enough money, and your medical evidence is not especially strong, you may wish to accept a lump sum settlement rather than risking a denial by a workers’ compensation judge. However, if the insurer is not offering a fair settlement, the only way to get the money that you need may be to take the case before a judge. Trials do carry significant risk for both sides to a dispute.
One of the most important factors to consider in connection with a lump sum settlement is whether you have gotten to the point at which your condition is not going to improve any further. The state upon which you are not likely to improve, even with further treatment, is called maximal medical improvement. After you get to this stage, your doctor will determine whether your injury has triggered a permanent impairment or permanent disability, which means that you are permanently restricted in what you can do and whether you can work as a result of the work-related injury. Whether or not to accept a lump sum settlement before you reach this stage is a conversation you may wish to have with an attorney. It is extremely risky to agree to a lump sum settlement when there is uncertainty surrounding the long-term effects of your injury and whether you will need more treatment.
Settlements can have differing levels of finality. With a compromise and release, you will be given a lump sum, rather than payments over time, and that part of your workers’ compensation case will be shut down. If you need more medical care than anticipated, your health care insurer or you will need to cover it. Compromise and release settlements are not subject to reopening. However, the risk involved in this type of arrangement can be mitigated by negotiating for a greater lump sum payment to account for the possibility of a contingency, or by combining different settlement options.
In contrast, you may be able to discuss how to settle a case through a stipulation with request for award. This type of settlement may be more appropriate if you know that you will need future medical care. In this situation, you agree to a specific amount of temporary or permanent disability payments to be paid weekly, and the insurer agrees to pay for future medical care that you need.
Any agreement that you reach about a lump sum settlement is between your employer’s insurer and you. However, it will need to be reviewed by a workers’ compensation judge for adequacy. Arguably, a judge is more likely to approve it if you are represented by a seasoned workers’ compensation attorney. The release that you sign will prevent you from making more claims for benefits arising out of that injury in most cases.
Although lump sum settlements can be good for some claimants, they present disadvantages or may cause hardships down the road for others. If you have been offered a lump sum settlement in Riverside or San Bernardino County, you should consult the Law Office of Joseph Richards, P.C. Our workers’ compensation lawyers represent people throughout Southern California. Call us at (888) 883-6588 or complete our online form.