It’s likely that by now you’ve heard of worker’s compensation–the benefits provided for anyone who is injured or becomes ill as a result of their job. These benefits will come in the form of regular payments, spread out over time. Sometimes, to reduce their liability, employers will instead offer employees lump sum settlements in place of these regular payments. Oftentimes, these lump sums will not be enough to fully cover medical bills of lost wages. If this is the case, the injured or ill workers should seek the counsel of experienced workers comp attorneys to help them get the compensation they deserve. However, lump-sum settlements are not always necessarily a bad thing, injured workers just have to fully consider their situation before accepting.
Pros of Workman’s Compensation Lump Sum Settlements
The most significant advantage of a lump sum settlement is that it provides an injured worker with immediate financial compensation. Regular workman’s compensation payments can be unpredictable and may not fully cover the worker’s expenses. A lump sum settlement can provide the worker with the financial resources they need to cover their medical expenses and other costs associated with their injury or illness.
Another advantage of a lump sum settlement is that it provides the injured worker with greater control over their financial situation. Regular workman’s compensation payments can be subject to changes in the law or other circumstances that are outside of the worker’s control. A lump sum settlement provides the worker with a guaranteed amount of money that they can use to plan for their future.
Cons of Workman’s Compensation Lump Sum Settlements
While there are many advantages to a lump sum settlement, there are also several disadvantages that should be considered.
The most significant disadvantage of a lump sum settlement is that it may not fully compensate the injured worker for their future medical expenses or other costs. A lump sum settlement is a one-time payment, and the injured worker will be responsible for managing their finances to cover their expenses.
Another disadvantage of a lump sum settlement is that it may not provide the injured worker with the same level of financial security as regular workman’s compensation payments. Regular payments provide a steady stream of income that can help the worker to plan for their future and ensure that they have the resources they need to cover their expenses.
Factors to Consider When Deciding Whether to Accept a Lump Sum Settlement
There are several factors that an injured worker should consider when deciding whether to accept a lump sum settlement. The first factor is the severity of their injury or illness. If the worker’s injury or illness is severe and will require ongoing medical treatment, a lump sum settlement may not be sufficient to cover their expenses.
The second factor to consider is the worker’s financial situation. If the worker has significant medical expenses or other financial obligations, a lump sum settlement may be the best option to provide them with the financial resources they need to cover their expenses.
The third factor to consider is the worker’s ability to manage their finances. If the worker is not experienced in managing their finances, a lump sum settlement may not be the best option for them. They may be better off with regular workman’s compensation payments that provide a steady stream of income.
The Importance of Working With an Attorney
If, even after weighing all of the pros and cons of accepting a lump sum settlement, the injured worker is still unsure of what they should do, they should consider seeking legal counsel.
A worker’s compensation benefits attorney will be able to break everything down for the worker, determining what they’re entitled to based on the typical factors like medical expenses and lost wages, but also accounting for any additional pain and suffering that the worker might have suffered as a result of their injuries.
In conclusion, workman’s compensation lump sum settlements can provide injured workers with immediate financial compensation and greater control over their financial situation. However, they also have several disadvantages, including the potential for inadequate compensation and reduced financial security. When deciding whether to accept a lump sum settlement, injured workers should consider the severity of their injury or illness, their financial situation, and their ability to manage their finances. It is also essential to work with a qualified attorney who can help to evaluate the terms of the settlement and ensure that the worker’s best interests are represented.