Expertly Reviewed By: Serah Waweru, Esq., on April 10, 2023
Workers’ compensation insurance can help protect employers and workers from the financial risks of job-related injuries. Learn more about how the workers’ comp settlement chart works, average payouts, what you must consider, and more.
What Is Workers’ Compensation?
Workers’ compensation is a type of accident insurance program an employer pays to an eligible worker. It protects employers from possible lawsuits related to workplace illness or injury and helps workers return to work by covering costs, such as:
- Medical bills
- Wages lost after an injury or illness due to a job
- Damages for severe injuries (e.g., loss of a limb)
Workers’ comp follows a no-fault system, meaning you won’t receive less due to your negligence, nor would the amount increase due to your employer’s fault. However, if the injury is intentional or due to intoxication from alcohol or illicit drugs, you could lose your right to compensation.
Except for Texas, most States legally require employers to buy workers’ compensation insurance from private insurance companies or use self-insurance plans (common in large companies). Small business owners can choose not to get workers’ compensation insurance in some states.
When should you tell your boss about the accident? You should do it as soon as possible — more specifically, within 30 days.
How Does Workers’ Comp Settlement Work?
Every State has different processes for claiming workers’ compensation. But, in general, you should immediately report to your employer if you suffer harm due to work-related responsibilities. In return, your employer files a workers’ compensation claim with their private insurer or the company’s workers’ compensation system.
Here are a few things to keep in mind before you agree on a settlement:
- The case closes once the workers’ compensation insurance company issues a lump sum payment to you. This means you’ll no longer receive additional compensation or medical care for your injury.
- Just because you’ve received a settlement offer doesn’t mean you must settle your case immediately.
- Your health insurance company might not shoulder the cost of your treatment after you settle the case.
- Depending on your State’s laws, you can’t file a personal injury lawsuit against your employer.
- You should settle workplace-related injuries through the workers’ compensation system.
You may reach a settlement when you and the insurance carrier agree on the amount to resolve the case. However, there are some instances where you might disagree on the total value of a claim. Instead, you can negotiate a settlement by going to trial, also known as a workers’ compensation hearing.
READ MORE: Workers’ Compensation 90-Day Rule Will Surprise You
Workers’ Compensation Settlement Process Explained
The steps for settling a workers’ compensation claim could differ slightly in every State. But just to give you a good idea, let’s take a look at what a standard claims process entails.
The Claimant
If you’re the claimant, follow these steps right after your injury:
- File a report immediately after the injury or as soon as possible ( usually within 30 days). Every State has its own deadline, so make sure to do your research.
- Get prompt medical care from a licensed doctor. Make sure the doctor is on your employer’s approved list of doctors.
- Complete the appropriate documents that detail your injuries and their causes.
- Your employer will contact their workers’ compensation insurer and file a claim.
- It’s up to the insurer to decide whether they’ll approve or deny your claim. You can file an appeal if the result doesn’t go in your favor.
- If the insurer approves your claim, they may offer you a structured settlement (paid in fixed time intervals) or a lump sum payment.
- If you disagree with the proposed compensation, you can go to trial to negotiate a settlement. Be sure to hire a reputable workers’ compensation lawyer.
- An administrative law judge (ALJ) handles the case. The difference between an ALJ and a traditional judge is that the former acts as both the judge and finder of fact (also called a trier of fact). Once everything’s settled, you can go back to work.
The Employer
- If you’re the employer, follow these steps once you receive the report that a worker was hurt:
- When you learn about the incident, ensure the injured worker gets proper care immediately.
- Investigate and document the accident. If possible, take pictures of where the accident happened before everything gets cleaned up.
- Get statements from witnesses, if any.
- Don’t forget to determine the possible safety issues that led to the worker’s accident.
- It’s your responsibility to file a claim with your insurance provider. Check with your State’s rules if you need to submit appropriate documentation to the state Workers’ Compensation Board.
- If necessary, your insurance provider might involve you during the investigation. You can also expect them to review the worker’s accident reports and medical documents.
What is the Average Workers’ Comp Settlement?
Settlements depend on different factors, such as your current and future medical bills, lost wages, disability rating (provided by the insurance provider’s doctor), retraining expenses (if you’re unable to return to your original position), and more. Because each case could be due to a variety of factors, it’s difficult to give an exact amount for a workers’ compensation settlement.
If you look at the statistics, the average workers’ compensation settlement could range from $2,000 to $40,000. Injuries with the highest payouts for lost-time workers’ compensation by body part involve your head or central nervous system (made up of your brain and spinal cord).
However, you shouldn’t treat this figure as the standard amount for all workers’ compensation settlements. Sometimes, your settlement offer could be much lower, especially if you can quickly return to work without permanent disability. Between 2019 and 2020, the average payout for these injuries was $93,942 for every claim filed.
The money you’ll receive from the settlement usually covers the following expenses:
- Ambulance services
- Disability payments
- Lawyer fees
- Past and future medical bills (including surgery)
Below are the estimated average body part workers’ compensation settlement chart and table. The workers’ comp settlement chart is based on the 2019-2020 National Council on Compensation Insurance data.
Body Parts Payout Workers’ Comp Settlement Chart, 2019-2020
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Source: National Council on Compensation Insurance
If your employer or the company’s private insurer disputes your claim, you won’t receive any cash benefits. Instead, you must wait for the administrative law judge to decide which party is right. While waiting for the judge’s decision, you could be eligible for disability benefits. However, the cash benefits you receive through the Disability Program will be deducted from your future workers’ compensation settlement.
Things to Consider Before Accepting a Workers’ Comp Settlement
Before settling with your employer’s insurer, consider the questions below. Please remember that these questions serve only as a guide, and not all will apply to your specific case.
How do I know if I’m eligible for workers’ compensation?
Most employers are legally required to pay their workers compensation if they get injured or ill due to work-related reasons. If workers die on the job, their dependents will receive workers’ compensation benefits.
According to the 2019 data from the National Safety Council, the top six causes of work-related injuries are:
- Overexertion (e.g., repetitive movements and lifting objects)
- Slips, trips, and falls (which made up 27.5% of workplace injuries)
- Contact with a harmful equipment or object
- Transportation accidents
- Acts of violence and other injuries caused by an animal or a person
- Exposure to harmful environments or chemicals
Should I get a lawyer?
The Workers’ Compensation Board always recommends talking to a lawyer. This is because claiming workers’ compensation can be a complicated and daunting process, especially when you’re still physically recovering from your injury.
Your lawyer will walk you through the process and offer crucial advice (e.g., the expected settlement and necessary documents) to ensure you’re properly compensated.
READ MORE: 4 Things Crooked Workers’ Comp Lawyers Won’t Tell You
What are the pros and cons of accepting a settlement?
Pros of accepting a settlement include the following:
- You can do whatever you want with your settlement money. For instance, you can use it to start your own business.
- You can put money in your pocket sooner because you don’t need to wait for your appeal or hearing.
- When you die, your dependent (or dependents) can still receive the proceeds of your settlement.
On the other hand, some cons of accepting a settlement include the following:
- Once you accept a workers’ comp settlement, you give up your rights to take legal action against your employer.
- You might use up your compensation money faster than you expected.
- Negotiating a settlement can be a long, exhausting process.
What states have the best workers’ compensation?
Iowa has the best workers’ compensation in the United States. Not only does the State have the shortest waiting period (around three days), but it also has the highest maximum weekly payment of around $1,628. Kansas, Utah, Minnesota, and Virginia are other U.S. states that process compensation claims much faster.
Does surgery increase my workers’ comp settlement?
Surgery can potentially increase (or decrease) your workers’ compensation settlement since it increases your medical bills. Undergoing surgery also indicates the severity of your injury.
However, the amount you’ll receive depends on the timing and type of your surgery. The computation of your settlement should include the following:
- The costs of additional surgery
- Rehabilitation after your surgery
- Costs of possible complications in the future
How is a workers’ compensation settlement calculated?
The expected amount of your workers’ compensation is based on the “who, when, what, where, and why” of your case. Therefore, you can’t expect to get the same amount as another injury claim. Factors that could affect the amount of your compensation include:
- Your type of injury or illness
- How your injury affects your ability to work
- Your average weekly salary
- The amount of time your injury kept you out of work
- Disputes filed by your employer’s private insurer (if any)
How long do most workers’ comp cases take to settle?
Ideally, your employer’s insurance company should take responsibility immediately. However, other workers’ compensation cases can sometimes take weeks or even years to settle. On average, a work comp case could take around 16 months to settle.
In California, for example, workers’ compensation cases usually settle within 30 days. In Texas, the average time frame for this type of case to settle via a court trial is around 15 months. But if you get a lawyer, you can speed up the process as much as possible.
How long will it take for me to receive compensation after accepting the offer?
Various factors can affect how long it takes for you to receive compensation money. On average, it could take 14 to 28 days. In Florida, it usually takes around four to six weeks for someone to get their settlement check.
Final Thoughts on Workers’ Comp Settlement Chart
Everything in this article, including the workers’ comp settlement chart, is only a general guide. Remember that each case is unique, so providing an exact time frame and settlement amount is nearly impossible. But if you want to expedite your claim, it’s always a good idea to consult a qualified lawyer specializing in workers’ compensation settlements.
