Settling your workers’ comp case without knowing the pitfalls can cost you big time. Let’s dive into the common mistakes people make and how you can avoid leaving money on the table.
One of the biggest mistakes injured workers make when settling a workers’ comp case is jumping at the first offer they get. Insurance companies love to throw out early offers to keep their costs down, especially in cases where medical bills and lost wages could really add up.
Those early offers can be tempting—sometimes they’re $15,000 or $20,000—which might feel like a lifesaver when you’re drowning in bills. But more often than not, they’re way less than what your case is actually worth. Without a lawyer to help you evaluate the offer and think about your long-term needs, you could end up leaving a lot of money on the table.
The key is to be patient and make sure the negotiations are thorough. That’s how you’ll get a settlement that’s truly fair.
Here are the most common mistakes injured workers make when deciding what kind of settlement to go with:
Not Knowing the Different Types of Settlements
Settlements like Stipulated Agreements and Section 32 agreements work differently, but a lot of workers don’t fully understand how. For instance, a Stipulated Agreement lets you reopen your case later if your condition gets worse, while a Section 32 closes everything for good. Picking the wrong one without knowing what it means for the future can really backfire.
Getting Hung Up on the Lump Sum
A big one-time payment can be super appealing, but it’s easy to overlook how it stacks up against your future expenses. You might need ongoing medical care or future treatment, and sometimes settlements that cover those needs are the smarter choice.
Ignoring Future Medical Costs
Planning for future medical care is a big deal, and skipping this step is a common mistake. For example, if you might need a knee replacement in a few years and you choose a Section 32 settlement, you could end up stuck paying for it yourself. Make sure you understand your medical outlook before deciding.
Overlooking Flexibility
A Section 32 settlement can feel like the cleanest option since it wraps everything up, but it also shuts the door on any flexibility. Stipulated agreements, on the other hand, can give you a balance—compensation now while keeping some options open for the future.
Rushing to Decide
Settlements are final, and rushing into one without fully understanding the terms or talking it through with your attorney can lead to regret. Take your time to weigh your options and think about how your condition might change over time.
Letting Emotions Take Over
It’s natural to feel frustrated with the process or just want to move on, but letting those emotions drive your decision can cost you in the long run. Make sure your choice is based on a clear understanding of your rights and what you’ll need down the road, not just a desire to be done with it all.
Figuring out how much your workers’ comp settlement is worth isn’t something you can just guess—it takes a solid understanding of all the factors that affect your payout. Unfortunately, there are some common mistakes that can leave workers with less money than they deserve:
Missing Key Factors
A lot of workers don’t take into account important details like their average weekly wage, how much time they’ve missed from work, and how severe their disability is. These are the building blocks for valuing your case, and if you get them wrong, you’re likely to end up with a smaller settlement.
Ignoring the Big Picture
Settlements aren’t just about quick financial relief—they’re about planning for the long haul. Things like rising costs of living, ongoing rehab, or unexpected medical issues often get overlooked, which can create serious money problems down the road.
Not Finding the Right Balance
It’s easy to either undervalue or overvalue your claim. If you aim too low, you’re leaving money on the table; if you aim too high, you risk dragging out the process. Finding that sweet spot takes experience, which is why professional guidance can be a game-changer.
By paying attention to these details, you can put yourself in a much better position to get a settlement that takes care of both your current needs and your future ones.
Injured workers often get the wrong idea about their settlements, which can lead to some big disappointments. For example, workers’ comp isn’t meant to cover pain and suffering or make you completely whole financially—it’s there to help with lost wages and medical bills.
While settlements are tax-free, any prior payments you’ve received might lower the final amount. A lot of people also don’t think about how their decisions could play out down the road. Take Section 32 agreements, for example: once you sign, your case is closed for good, and you can’t go back for more later.
Knowing these limits is super important if you want to make the right call about your settlement.
Even after getting a settlement, injured workers can make mistakes that mess up their financial or medical future. Here are some of the most common ones:
Blowing Through the Money
Some people use their settlement cash on things they don’t really need or don’t plan for long-term expenses. Without a solid financial plan, you can burn through the money fast and be left struggling to cover future medical or personal costs.
Not Preparing for Medical Expenses
If your settlement closes your case for good, you’re on the hook for all future medical bills. A lot of people don’t realize how expensive this can get and end up in a tight spot when more treatment is needed.
Misusing Medicare Funds
If you have a Medicare Set-Aside (MSA), you’ve got to spend that money the right way. Using it on treatments that aren’t approved can cause big problems—like Medicare refusing to cover your medical costs later.
Skipping Professional Advice
Going it alone without help from a financial advisor or lawyer can mean missing out on ways to make the most of your settlement. Experts can help you budget, invest, and plan for what’s ahead.
Avoiding these pitfalls can go a long way in making sure your settlement works for you in the long run.
The biggest mistake injured workers make is not hiring an experienced attorney to help with their case.
A lot of people think they can handle the settlement process on their own or trust the insurance company to play fair—but that often backfires. Insurance companies have whole teams of lawyers and adjusters working to pay out as little as possible, and without someone in your corner, you’re likely to settle for less than you deserve.
A good attorney will make sure your case gets the attention it needs, handle negotiations like a pro, and look out for your long-term interests. Skipping this step can lead to expensive mistakes you can’t undo later.
Navigating a workers’ compensation settlement is no easy task—it’s a process full of decisions that can have long-term consequences. Whether you’re unsure about your next steps or just need a clearer understanding of your options, I’m here to help.
If you’ve got questions, let’s talk it through. Give me, Rex Zachofsky, a call at 212-406-8989, and we’ll figure it out together.
No pressure, just a conversation to help you make the best decisions for your case and your future. Looking forward to hearing from you!
