Understanding Settlement Negotiations: Insights From a Workers’ Comp Attorney

Tens of thousands of injured workers file workers’ compensation claims in Virginia every year. Many of these cases are resolved via settlement. These agreements are often forged through negotiation, with a workers' comp attorney on one side and the insurer on the other.

If you’re preparing to file a workers’ comp claim, it’s important to understand the central role that negotiation plays in the settlement process.

Key Factors That Influence Settlement Offers

Determining the fair value of a settlement is the most essential step in your workers’ comp claim. Many variables may factor into the valuation, which means no two settlement offers will be exactly alike.

The major factors that will influence the amount you stand to receive include:

• The nature and severity of your injury
• Your current and future medical expenses
• Your physical pain and distress
• Your weekly wages
• Disputes on the part of your employer or their insurer

First and foremost, the type of injury you sustained can have a substantial impact on the proposed settlement amount.

For instance, awards for serious injuries like fractures, burns, and amputations are typically higher than those for minor injuries like sprains and concussions.

If you lost a limb, your treatment will likely involve prosthetic devices, which may need to be periodically replaced. You may also need physical therapy and assistance with pain management.

How a Workers’ Comp Attorney Can Aid in Negotiations

Most attorneys are master negotiators. They learn this skill in law school, refine it with every case they take on, and use it extensively throughout their careers. A workers’ compensation lawyer can put their experience to work for you to maximize your settlement.

A settlement shouldn’t be a roll of the dice. Your workers’ comp attorney will use the negotiation process to reach a fair and adequate settlement.

When the insurer is prepared to settle, they’ll have an action plan with a target value range. They’ll typically resort to various tactics to keep the offer in that range. Your attorney will know how to anticipate and respond to these tactics.

The negotiation process begins when your attorney prepares a settlement demand letter, which will set a high starting point. After you approve the letter, your lawyer will send it to the insurer.

The insurer will respond with a counteroffer, and you and your attorney will review it to ensure that it adequately covers your present and future medical expenses and lost wages. If not, your lawyer will push to raise the offer to an acceptable amount.

You might receive a settlement offer from the insurer at almost any point in the claims process. In some cases — particularly those involving catastrophic injuries — an offer could come within weeks of the accident. Because initial offers tend to be low, a back-and-forth between your attorney and the insurer will usually ensue.

How to Assess a Settlement Offer

Once you receive a settlement offer from the insurer, the choice is yours whether to accept or reject it. However, this isn’t a decision you should make without due consideration.

You and your attorney’s assessment should take into account the following:

• Your current and anticipated future medical needs
• Your future lost wages if you can’t return to work
• How close the offer is to your predetermined target value

A workers’ comp attorney can determine a fair value for your case. They can also help you review the offer to decide whether it will provide the financial and emotional support you need.

Benefits of Legal Representation During the Settlement Process

There are numerous advantages to hiring a workers' comp lawyer to handle your claim. Among other things, they can help you file the required paperwork, collect evidence to build a strong case, and assist in launching an appeal if your claim is rejected.

That said, these professionals offer two significant benefits directly related to the settlement process. Equal representation is one of them.

Your employer and their insurer will likely have a team of lawyers dedicated to handling employee injury claims. With a workers’ comp attorney representing you, you’ll have a place at the negotiating table and a better shot at recovering the compensation you deserve.

The other main benefit is a higher potential settlement amount. A 2018 study conducted by Insurtech Clara Analytics showed that injured workers who had legal representation received settlement amounts five times greater than those who represented themselves.

Understanding the Implications of a Settlement Offer

When you’re weighing a settlement offer, it’s imperative that you understand the implications of accepting it.

If you agree to a settlement, you won’t be able to make any additional claims in the future — your case will officially be closed. Another potential pitfall is the prospect of running out of money. You may be the best of budgeters, but some forces, like inflation, are out of your control. If you’re unable to work, it could put your future at risk.

FAQ

What Is a Full and Final Settlement?

A full and final settlement is one that resolves a claim in exchange for a lump sum. It’s the most common type of settlement in injury cases.

What Is a Structured Settlement?

Unlike a full and final settlement, a structured settlement is paid in installments over a particular period of time, such as six months or two years.

What Is the Functional Capacity Evaluation?

A functional capacity evaluation is a series of tests that assess an injured worker’s physical abilities. A physician may order such tests at the request of the insurer or the worker. They serve to provide confirmation of injuries and determine what activities the worker can perform.

Get Reliable Legal Assistance After a Workplace Injury

If you’ve been hurt while performing your work-related duties, the capable legal team at Commonwealth Law Group can help you make the most of your claim. Contact us today to schedule a consultation with a skilled workers’ compensation lawyer.