It is sometimes possible to receive a one-time lump sum payment for your workers’ compensation claim, rather than ongoing weekly or biweekly payments. This may or may not be the best thing in your situation.
Under Pennsylvania workers’ compensation law, to receive a lump sum payout, you would have to compromise and release your workers’ compensation claim, and have it approved by a workers’ compensation judge.
It is critical to discuss all your options with an experienced workers’ comp attorney before signing anything. This could be one of the most important financial decisions of your life, and could affect you and your family for the rest of your life.
Things to know before considering a lump sum
- You are signing away rights. It is critical to discuss all your options with an experienced workers’ comp attorney before signing anything.
- The insurance company is not looking out for your interest. They are trying to pay the smallest amount possible.
- You may be able to obtain a lump sum settlement for either your wage loss benefits, your medical benefits or both. You may also obtain a lump sum for a specific loss such as an amputation or vision loss. Your family may also be able to obtain a lump sum in the event of your death.
Possible advantages of a lump sum
- A lump sum gives you a large sum of money immediately, instead of smaller payments over time.
- A lump sum ends the workers’ compensation insurance company involvement in your claim so you don’t have to worry about examinations or them trying to turn off your benefits.
Possible disadvantages of a lump sum
- The lump sum will only cover you for a limited amount of time.
- If you have unforeseen medical complications, your employer will not be responsible for increasing the payment.
- You most likely would have to resign from your job.
Let’s return to the show Frasier for an example. At the beginning of the series Frasier’s father Martin comes to live with Frasier because of an injury that he suffered at work. Martin, a police officer, was shot on duty while interrupting a robbery at a convenience store, and was permanently disabled as a result. His injury inhibits him from living alone, and forces him to accept Frasier’s invitation to live with him.
Would it have been in Martin’s best interest to take a lump sum payment?
Because Martin can’t live alone, and needs a walker to walk, it appears that he has a permanent injury that may prevent him from working in the future. In cases such as this, it still may make sense to negotiate a lump sum payout because it may be in the employee’s best interest.
Each situation has unique factors. This is why it is essential to consult an experienced workers’ compensation attorney before making any decisions.
If you have suffered a work injury and have questions about whether a lump sum payout is in your best interest, contact the experienced workers’ compensation lawyers at Aversa and Linn to assist you with understanding your rights under the law.
