When Will Workers' Comp Offer a Settlement?

If you got injured or sick at work, you’re not alone. Private companies in the United States reported 2.8 million workplace injuries last year.¹ State workers’ comp insurance can provide payment for lost wages and medical bills, but you may also receive a lump-sum settlement offer instead of regular benefits.

You can negotiate a settlement on your own, but that quickly becomes complicated. Insurance wants to pay as little possible, but you need to ensure you get enough to cover all current and future expenses related to your injury.

Let's look at how workers’ comp settlements work, when you might get one, and what your options are if you receive an offer.

What is a worker’s comp settlement?

A settlement is an offer from the workers' comp insurance company to pay you a set amount of money instead of regular medical and wage benefits. A settlement is usually one lump-sum payment, but you may also have the option for a structured payment plan. When you agree to a settlement, your workers' comp claim is closed and you receive the settlement in their place.

Not all workers’ comp cases end in a settlement, but many do. How much you get also depends on your workplace injury, the workers’ comp laws in your state, and other factors that we discuss below.

When will workers’ comp offer a settlement?

You can receive a settlement offer at any point in the process, but settlements commonly happen around the time you reach maximum medical improvement (MMI). At this stage, you and the insurer have a better idea of whether you could need long-term benefit payments, how much more medical care you’ll receive, and how much treatment will cost.

In some cases, a settlement offer could also come very early in the process. Giving you one lump-sum payment early on is much simpler for an insurer than navigating months of payments and medical care. Early settlements also protect the insurer in case you have unexpected symptoms or setbacks during treatment.

Another factor that can impact when you get a settlement is the time of year. Some insurance companies (or even workers’ comp lawyers) will push to settle before the end of the calendar year in order to get the settlement contract on their books for the upcoming tax season.

How to respond to a settlement offer

Once you get a settlement offer, you have three possible actions to choose from:

1. Accept the settlement as offered (least common).

2. Negotiate the settlement amount (most common).

3. Reject the settlement and continue benefits (not always possible).

The first settlement offer from insurance is rarely the best payout you could possibly get. The insurance company will be looking to maximize its own profits, and generally has it's own team of lawyers who decide the lowest offer it can make.

Even if you want to accept a settlement, it’s important to pause and double check whether it’s enough to cover your current medical bills, future medical expenses related to your injury, and the money you’ll need to pay for housing, food, and all other bills while you’re out of work.

We recommend connecting with a workers' comp lawyer for help negotiating a fairer deal.

When should I get a lawyer for my settlement?

If you've received a settlement offer, a workers' comp lawyer can negotiate a much larger settlement. Since an experienced lawyer has helped workers in similar situations, they’ll understand how to estimate your future medical costs and how much income you could lose because of your injury.

On average, the settlement for workers with an Atticus lawyer is twice as high as people who don't have a lawyer.

Again, there’s nothing wrong with accepting a settlement offer and you don’t need a lawyer. But it's important to make sure the settlement is enough to cover all your current and upcoming expenses. The last thing you want is to accept an offer because it sounds fair, only to realize a few months later that your medical bills are higher than expected and you need to either go into debt or try returning to work while still injured.

Further reading: 7 Situations When A Workers' Comp Lawyer Can Help

How much does a workers’ comp lawyer cost?

Finding an affordable lawyer is easier than you think. Atticus workers’ comp lawyers all offer a free consultation and don't charge anything upfront.

There is a one-time lawyer fee, which you only pay after you get your settlement. The fee you pay varies by state, but the average workers' comp lawyer fee is between 15% and 30%. And while that can be a lot, the average settlement with an Atticus lawyer is twice as high as what you'd get on your own, so you're still making significant money even after the fee.

To get started, fill out our workers’ comp questionnaire or call us at the number below. Our team will reach out to learn more about your situation, answer your questions, and connect you with a lawyer who's a good fit for your case.

6 Factors that affect your settlement

The following six factors will impact your settlement amount and timing.

1. The severity of your injury or illness: The insurance company may be more motivated to settle if it looks like your recovery will last months or years. An injury that’s more severe or involves an unpredictable recovery will also lead to a higher settlement value because it needs to cover more medical bills and more weeks of lost wages.

2. The treatments you receive: Certain treatments can increase or decrease your potential payout. For example, a surgery that improves your symptoms could lower your payment, while a surgery with complications could raise it. (Learn more about how surgery affects settlements.)

3. Where you live: Workers’ comp laws vary by state and your state may have more guidance on how much insurers should pay for certain injuries. Learn more about how much workers' comp pays in every state in 2024.

4. Appeals and denials: Your claim can take much longer to settle if the insurer denies your workers’ comp claim or appeals your benefit amount. Both of these scenarios could lead to some sort of mediation or court hearing to confirm that you should even get benefits. In this case, your settlement may also cover the payments you've missed so far.

5. Your disability rating or impairment rating: As you reach maximum medical improvement, your doctor will do an assessment to give you a disability rating or an impairment rating. These ratings use a scale of between 1% and 100% to define how much your disability impacts your ability to work or function. A 100% rating would mean total disability, whereas a 50% rating would mean you’ve lost 50% of functionality in the affected part of your body. A higher rating often leads to a higher payment.

6. Your lawyer’s, mediator’s, or judge’s opinions: During a settlement negotiation, your employer’s insurer can debate all of the factors above to limit how much you get. Your lawyer will advocate for the highest settlement possible by making a case for you (so finding a good workers’ comp lawyer really helps). If your settlement goes to mediation or court, the opinions of the mediator or judge will also affect how much you get. A lawyer will also know how to build a convincing case to a judge.

Related: Average Workers' Comp Settlements by Body Part

How long does a settlement take?

Unfortunately, there is no one answer that applies to every situation. Smaller settlements could take a few weeks to work out while larger settlements could take two years or more. A safe estimate for many people could be at least one year to complete a settlement, but you’ll get a much more accurate estimate from a lawyer who knows your claim details.

Getting a settlement may take longer with a lawyer, but ultimately you're still getting more. A lawyer will also work around your personal situation to make sure you're getting proper benefits in the short-term while you aren't working.

How long after a settlement will I get paid?

Most people will need to wait at least a month or two for their payout, but that depends on where you live, the size of your payment, and the other details of your settlement. A lawyer can provide a more precise answer.

Get help with your settlement

The best way to get personalized advice on your settlement is by talking with a lawyer. They’ll know your local laws and can help you negotiate for the benefits you deserve so you can get back to work and move on with your life.

Atticus is a law firm with lawyer across the country, and we can match you with an experienced lawyer in your area. To get your questions answered and connect with a lawyer today, fill out our intake quiz or call us at the number below. Getting matched is free, your first consultation is free, and the lawyer won’t charge anything up front.

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