Although workers' compensation insurance plays an important role in protecting employees against financial burdens caused by workplace injuries and illnesses, and also protecting businesses from lawsuits filed by injured workers, workers' compensation insurance companies are for-profit businesses and are not generally in the habit of spending more money than they have to. You may feel wary of accepting any settlement offer your insurer makes.
Typical Settlement Length
Workers' compensation insurance companies consider many factors when they determine your settlement amount. They must tally all the bills, anticipate all future potential bills, litigate for and defend you when necessary, and often coordinate with the federal government if you are eligible for Medicare. This can take a long time. Some insurers have been accused of unnecessarily delaying claims in the hopes their customers will lose the will to fight and accept a small settlement. A common complaint among workers' compensation customers is that their settlements don't come fast enough.
Unlike most types of insurance, workers' compensation has no specific maximum dollar limit for the benefits available to injured workers. The insurance adjusters set limits for each claim by managing the medical care, such as authorizing a certain number of doctor visits. However, the policy doesn't have a maximum benefit, and injured workers could potentially receive benefits for the rest of their lives. Offering a quick settlement may save an insurer from paying higher, costlier benefits later on.
Claim delays are an alleged settlement tactic used by insurers to achieve smaller payouts, and many states have claims settlement laws forbidding unnecessary delays. Despite this, claims cost money each day they remain open. An adjuster, often paid an hourly wage, must work the claim until it is concluded. If too many claims are open at once, the insurer must hire additional adjusters to manage the workload. A rapid claims settlement may be a way to stem administrative costs by closing a file quickly.
You always have the right to hire a lawyer, though your insurer may discourage you from doing so. You also may be cut out of the negotiation process if you choose to hire one since all communication generally goes through the lawyer's office once she is involved. However, workers' compensation lawyers generally know more about the law and the insurance system than you do, and may be able to work with your insurance company to get you better treatment or a higher settlement. The insurer may benefit from closing your claim before lawyers get involved.
Each claim situation is different, so you have to judge your insurer's motives based on the circumstances of your claim. While there may be selfish motives at work, your insurer may genuinely believe that your claim is finished and may be trying to help you get on with your life. Handling your claim in a timely manner is good customer service -- as long as your illness or injury has been properly treated.