Can I Get a Lump Sum Workers’ Comp Settlement?
Getting hurt on the job can be an unexpected and life-altering hardship. If you’re like most people, not being able to work is like having the rug pulled out from under you. It may feel as though you’ve lost financial security and you might wonder how you are going to pay the medical bills that are piling up. Fortunately, workers’ compensation was created to help you through these tough times.
Workers’ compensation is a form of accident insurance that applies to those that are hurt on the job. The benefits help cover medical bills, rehabilitation costs, and paychecks lost during the period when you are unable to work. Most employers in Georgia are required to provide these benefits to employees through workers’ compensation insurance policies.
If you qualify for benefits and are able to reach an agreement with the insurance company, you may choose to accept the settlement offer. The settlement may be in the form of a single lump-sum payment or paid out on a weekly, monthly, or annual basis. In most cases, insurance companies prefer settling a workers’ compensation claim over going to a hearing.
Amount of Settlement
It’s difficult to know in advance the amount of a settlement offer from an insurance company. This is because a number of factors go into the calculation. These include:
- The severity of your injuries,
- Any past and future medical bills,
- Your reduced earning capacity, and
- Whether or not you are able to return to work.
Note that the amount of any money you receive as a lump sum will be reduced based on the “present value” formula. This simply means that money received now is considered more valuable than money paid out at a later date. The rationale being that you can use this money immediately and it can earn interest.
Further, certain debts can be legally deducted from settlement amounts. These debts include attorneys’ fees, unpaid medical bills, and even unpaid child support. For this reason, it can be helpful to speak to an attorney who can evaluate your case and determine a fair settlement for your injuries, taking into account all of these factors.
The Settlement Process
Although you can reach a settlement at any time, it is generally best to wait until you know the full extent of your injuries and how long you expect to be out of work. You should also be aware that all settlements must be approved by both the insurance company that provides the workers’ comp coverage and the Georgia Board of Workers’ Compensation (‘the Board’).
The process starts once you send the insurer a settlement demand. This is considered the beginning of negotiation talks between you and the insurance company. There may be a lot of back and forth with company representatives during this time. Once you reach an agreement, you must complete and file specific documents with the Board. This paperwork includes the stipulated agreement, claims forms, and medical records. It can be helpful to reach out to a qualified attorney to ensure that your documents are completed and filed correctly.
Following Board approval of your settlement, the insurance company then has 20 days to forward your settlement payment.
Factors to Consider
It is important to note that once your settlement amount is approved by the Board, it is considered final. You cannot change your mind after this point. Further, by accepting this payment amount, you are effectively giving up your right to collect any additional workers’ compensation payments related to the injury. This is true even if your condition worsens and you need to undergo additional medical procedures.
That being said, in some cases, you may be able to get the insurance company to agree to a “limited” settlement. With a limited settlement, you receive a lump sum and the insurer agrees to also pay for future medical treatment. However, bear in mind that insurance companies are very much interested in finalizing workers’ comp claims. For that reason, these more open-ended arrangements are rare.
Alternative to Settlement
Now, not all workers’ compensation claims reach a settlement. If you and the insurance company cannot come to an agreement on payment amounts for your injuries, you may request a hearing before the Board. At the hearing, an Administrative Law Judge will listen to both you and the insurance company and then make a final decision. Once the decision is made, any benefits you receive will most likely be paid out on a weekly basis as opposed to in the form of a lump sum.