If you’re injured and receiving workers' compensation benefits, it can be tempting to settle your case with the insurance company for a lump sum payment of tax-free cash. But is it a good idea to settle your case? What are the advantages of doing so? And are there any reasons why you shouldn’t settle? Let’s explore these questions in detail.
One of the biggest advantages of settling your workers' compensation case is that you get to bargain for a known outcome. If you go to trial, there’s a chance you could get more, but there’s also a chance you could get less or even nothing. Settling eliminates this risk by providing a definite amount that you agree to, ensuring you receive compensation for your case.
Settling your case means you’ll receive a lump sum payment from the insurance company, which is yours to keep forever. While workers' compensation benefits typically end when you’re medically cleared to return to work, a settlement provides a financial safety net for you and your family, relieving any financial pressure you might be experiencing.
Settlements are usually quicker than taking your case to trial. Once everyone agrees, the process involves paperwork, getting board approval, and a judge's sign-off, which can take just weeks to a few months. This allows you to put the case behind you and move on with your life sooner. Additionally, settlements provide flexibility. Sometimes insurance companies may not want to formally accept a claim due to potential precedents or liability issues, but they might be willing to pay additional compensation in a settlement.
Receiving a lump sum now can be more valuable than waiting for future payments, especially considering inflation. Money you get today is worth more than money you receive down the road. You can invest the lump sum and potentially grow it, making it worth more than periodic payments over time.
The biggest downside to settling is that you might not get the full value of your claim. Insurance companies usually only offer a percentage of what they owe you if you opt for a lump sum. While it’s often a large percentage, it’s still less than the total amount you’d receive over time.
Insurance companies know that many people prefer to avoid the risks of a trial, so they often present lowball offers hoping you’ll accept out of fear or impatience. It’s crucial to be wary of these offers and to negotiate effectively.
When you settle, you typically waive your future rights to request benefits for that injury, both medical and financial. This means you could end up covering future medical expenses out of pocket. Proper planning is essential to manage your settlement wisely and avoid financial strain later on.
Once you accept a lump sum settlement, it’s generally impossible to reopen your case or receive further compensation for that injury. While some settlements, like indemnity-only Section 32 agreements, leave the medical portion open, most settlements close your case entirely.
To get a fair settlement, you need strong negotiation skills. Insurance companies have skilled adjusters and attorneys who negotiate settlements daily. Without experience, you’re likely to leave money on the table. This is where having a workers' compensation attorney can make a significant difference.
Now that you know the pros and cons, the big question remains: Should you settle your case?
The decision to settle is very personal and depends on your specific situation. If you need significant medical treatment or surgery, settling might not be the best option as you’d take on the financial burden yourself. However, if you urgently need the money or want to avoid the stress of a trial, settling might be more appealing.
Consider your future medical needs, current financial situation, and your comfort with the trial process. Consulting with an experienced workers' compensation attorney can help you navigate this decision and ensure you receive fair compensation.
If you or a loved one have been injured on the job in New York and are considering settling your case, I invite you to schedule a free consultation with me. An experienced lawyer can provide valuable guidance and fight for the compensation you deserve. Call me at 212-406-8989 today.
For more information on workers' compensation and other related topics, be sure to explore my other blog posts and videos. Your journey to understanding and maximizing your claim starts here.
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