What is a Lump Sum Workers’ Compensation Settlement, How does it Work, and Should You Take It?
Generally, a workers’ compensation claim can be settled in a lump sum if the parties agreed to it. The settlement process is entirely voluntary with no court interference. Workers’ compensation committees and judges in Los Angeles, like most other cities, do not have the authority to conclude the case by requiring a lump sum payment amount. But how is this case settled? Is a lump sum settlement better? In which situations should you accept a lump sum offer? These are important questions that must be answered before accepting a lump sum settlement.
What is Meant by a Workers’ Compensation Lump Sum Settlement?
A workers’ compensation lump sum settlement is allowed if a worker has been off work for four months or more due to a work-related injury. In such a situation, the injured worker can settle with the company’s insurance company for a lump sum amount.
A lump sum amount is a one-time payment that can replace a series of payments. An injured worker can accept a lump sum amount for both the medical bills and lost wages. The total amount cannot be more than the weekly compensation amount multiplies by 500 weeks.
The benefit of accepting a lump sum amount is that it saves you from fighting with the insurance company over the continuation of worker compensation benefits. You will receive one large amount with no further contact with the insurance company.
On the other hand, you forgo future rights of weekly payments when you accept a ‘buyout’ options. Generally, you can’t reopen the claim once the settlement is reached with the insurance company.
When Should You Accept a Lump Sum Settlement?
If you have been injured at a workplace, you should think twice before accepting a lump sum settlement amount. After the amount is spent, you won’t receive any more money as worker compensation for medical treatment.
Before accepting a lump sum offer, you should make sure that it will cover all your injury-related expenses. Some of the reasons you may want to refuse workers compensation claim include the following:
- The money is not enough to cover medical bills
- The amount will not meet expenses for the rest of life
- You know that you can’t handle a sudden windfall
There are a lot of factors that you should consider before accepting a worker’s compensation lump sum settlement. Consider hiring a workplace attorney to know whether it’s a good idea to accept or reject a lump sum settlement.
Our experienced attorneys can provide you with valuable advice regarding the case. The moment you contact us you will get experienced qualified help relating to the matter. We can make the process of navigating through the complex workers’ compensation law easier for you.