Negotiating Permanent Disability Settlements
For many injured workers, a permanent disability settlement represents the end of a very long process within the workers’ compensation system. This is a crucially important stage, because once you accept a settlement, that decision is irreversible. You can never go back and ask for additional sums for expenses related to your injury. That’s why it important to understand the process for negotiating your PD settlement.
Once any conflicts concerning your disability rating are resolved, your regular, weekly PD payments begin. At this time, the claims administrator for the insurance company may contact you with an offer to settle your case. There are two ways in which an insurer settles a case: a structured settlement paid over time, called Stipulations with Request for Award (Stips) or a Compromise and Release (C&R) paid in one lump sum. There are pros and cons to each option, and the best choice for one worker may not be optimal for another, so it pays to understand what each option offers:
- Stips — You come to an agreement with the adjustor on how much your total PD award will be and how to break that amount down into separate payments for a certain amount of time. Remember, PD is only designed to cover lost income. You also have to stipulate the terms for future medical care related to your injury. And you need to negotiate the terms by which you can request additional benefits if your condition unexpectedly worsens or the insurer can decrease payments if you improve.
- C&R — The considerations are the same: the amount of the award must cover your lost income and your anticipated medical needs. However, once you sign this agreement and the insurer makes the lump-sum payment, you free the insurer from all future responsibility. You cannot go back and demand an adjustment if your condition deteriorates.
There are many things to consider when deciding whether to settle your disability claim. Evaluating your likely need for future medical care, what that might cost in the future, and the possible increase to your cost of living can be complex and may require assistance from medical and financial experts.
If you have received an offer to settle your permanent disability claim, consult an experienced workers’ comp attorney right away. A knowledgeable attorney at the Tous Law Group can provide the guidance you need to make a truly informed decision. Call 714-602-4473 or contact our Orange County office online to schedule a free consultation.