I Was Offered a Lump Sum Settlement — Should I Take it?
September 17, 2013
Multiple states are finally able to collect settlements from a case 28 years in the making. In 2010, American International Group (AIG) agreed to pay $146.4 million after a multi-state investigation found the insurance company underreported workers’ compensation premiums between 1985 and 1996, hiding at least $2.12 billion. However, the awards could not be paid out until AIG resolved other settlement disputes. Now, states can begin to collect. Pennsylvania is slated awards of more than $16.8 million.
Whether on a scale as large as multi-state or as small as an individual employee, settlements are a common route for workers’ compensation claims. If you were injured on the job in Pennsylvania, settling your claim may be the best option if you don’t want to deal with a lengthy claim process or if you are no longer expected to recover from your injuries. However, it is not the best option for everyone, and making a knowledgeable and informed opinion is important to receiving the compensation you deserve.
What is a lump sum settlement?
The Pennsylvania Workers’ Compensation Act allows an injured worker and employer to reach an agreement for a lump sum settlement. Some key points of a lump sum settlement are:
- You receive a one-time payment instead of incremented workers’ compensation checks
- The settlement takes into account past and future lost wages, medical expenses or both
- The settlement releases your employer from future liability for your injury
- The settlement closes your case
While some people may want a final, case-ending payment, others may realize it is not in their best interests. It is important to understand that once you take a settlement, you cannot go back for more money, even if your lump sum runs out and you still have bills to pay or cannot return to work.
Insurance companies are not looking out for your best interests. They try to find ways to make the smallest payouts possible, even if they know you deserve more. Having an experienced Pennsylvania workers’ compensation lawyer on your side can be vital during the claims process and if, and when, a settlement is offered.