Should I Settle My Workers’ Compensation Claim?
Every workers’ compensation claim is different but many injured workers reach a similar point when an insurance adjuster calls with an offer to settle their claim.
In this post, our Vermont workers’ compensation attorneys answer five questions to help you decide how and when to settle your workers’ compensation claim.
The bottom line is: never sign a settlement agreement until you know if it’s in your best interests. Settlements are final and you could give up valuable rights without realizing it. Always talk to a lawyer before signing.
1. Which Kind of Settlement Is Being Offered?
If the insurance adjuster is offering to settle, it’s important to understand what kind of settlement they are talking about. In a workers’ compensation claim, there are usually two kinds to consider: a permanency settlement or a full and final settlement of your claim.
A Permanency Settlement
If the adjuster sends you a Form 22, they are offering a permanent partial disability (PPD) settlement. This is what people generally mean when they say they got a workers’ compensation “settlement.” It is usually offered if you have recovered but are left with a partial disability from your injury, such as a limp, loss of range of motion, or lingering pain. The insurance company offers to pay you an amount of money as compensation for lost wages over your lifetime. The amount is decided using a formula based on your injury type and an impairment rating by a doctor.
When you are offered a PPD settlement, it’s important to know:
- A PPD settlement does not close your workers’ compensation claim. Your claim remains open and you are still entitled to get medical benefits. The insurance company must continue to pay for future medical treatment related to your injury.
- In Vermont, you can choose the doctor you want to do the medical evaluation for your impairment rating. The Department of Labor website has a list of doctors who do these evaluations. Alternatively, BFS can help you choose a good doctor who will be accurate and generous in the rating they give you.
- If the insurance company does not agree with the rating you are given, they can send you to a doctor they choose. In this case, the insurer must pay for both examinations. It is very important to get a fair and accurate permanency evaluation since an incorrect one can cost you thousands of dollars in permanency benefits.
A Full and Final Settlement
If the insurance adjuster offers a “full and final” settlement, they mean to permanently close your entire workers’ compensation claim and pay you a one-time settlement amount. As part of the agreement, you usually have to give up your right to future benefits. This includes medical coverage, which otherwise continues for your lifetime if you don’t settle.
If you are offered a full and final settlement, it’s important to know:
- If you give up medical benefits, you will not be covered if your injury gets worse over time or if you need ongoing medical treatment or prescription medications. For this reason, we recommend that you talk to a lawyer before signing a full and final settlement. The insurance company’s offer may sound generous until you compare it to the cost of future treatment over a lifetime. BFS can help you to estimate the value of what you are being asked to give up and negotiate a fair outcome that covers your future medical costs.
2. When Will I Be Offered A Settlement Agreement?
Insurance companies can offer to settle at any time. PPD settlements are offered when an injured worker has a permanent disability and has recovered as much as they are able to. In insurance terms, they have “reached medical end.” Full and final settlements may be offered to workers with injuries that are catastrophic or claims that last many years. Sometimes, a settlement offer can come when you haven’t been paid any benefits for years.
3. How Do I Know If A Settlement is Fair?
A good way to find out if a settlement is fair is to have it reviewed by a professional who understands the Vermont workers’ compensation system. An experienced workers’ compensation lawyer will be able to tell you whether the agreement is fair to you or whether it favors the insurance company. It’s in the insurance company’s interests to offer you just enough money to make it hard to turn down. We can tell you over the phone if the settlement amount is in the right range, based on your injuries and the medical treatment you’ve had. Many attorneys, including BFS, offer free consultations with no obligation to sign up as a client. The Vermont Department of Labor must review your settlement agreement to be sure it is in your best interests. After they approve it, it becomes final and can’t be undone except in very rare situations.
4. When Will My Settlement Money Arrive?
Once you settle your case and the Department of Labor approves it, your check should arrive within a week or two. Money received from a workers’ compensation settlement is not taxable.
5. What’s The Right Decision For Me?
Whether a settlement agreement is right for you depends on your unique injury and situation. It’s important to read the settlement offer and take steps to make sure your interests are taken care of now and in the future.