How Long Do Workers Comp Settlements Take?
12 Situations When the Workers Compensation Insurance Company is More Likely to Offer a Settlement
Workers comp is notorious for endless litigation. Indeed, many occupational injury and illness cases require multiple evidentiary hearings and judicial opinions to resolve frequent disputes about prescribed medical care and entitlement to wage loss benefits.
But workers compensation insurers (Travelers, Liberty Mutual, and Hartford) and claim administrators (Sedgwick CMS, ESIS, or Gallagher Bassett) can offer a settlement anytime in the claims process, even before you file a claim for benefits or a request for a hearing. And many do, ending the case with a lump sum payment to you.
If you found this article, you likely agree that constant conflict can slow physical and mental recovery after a workplace injury and harm you financially. And you want to know when workers comp will offer a settlement so you can regain control of your medical treatment and have income while you plan the next step in your career.
This article answers that question by providing twelve case milestones when it is most likely that workers comp will offer a settlement. As you will see, some cases settle within days or weeks of the industrial accident, while others take 12 to 24 months (or longer), depending on the severity of the injuries and legal issues.
Keep reading to learn more about the timeline for work injury settlements. And then check out our article on calculating a reasonable workers comp settlement to decide if you should accept the offer or counter with a demand.
If you have more questions about workers compensation law in Virginia, call our firm at (804) 251-1620 or (757) 810-5614 to see how we can help you win.
Average Time Frame: How Long Before Workers Comp Offers a Settlement?
In our experience, the workers compensation settlement process takes 12 to 24 months.
But many factors affect the time it takes to get a workers comp settlement offer and negotiate a fair deal.
For example, your claim will likely settle sooner if you do not hire a lawyer to help you develop the evidence needed to increase the case’s value, negotiate for more money, or if you suffered a minor injury that healed quickly and thoroughly.
In contrast, the workers comp settlement process usually takes longer (18 to 24 months) if you hire a lawyer, have a permanent disability, or require surgery for the injury. But the delay in resolving the case can be offset by a better offer putting more money in your pocket.
Other factors that can change the time frame for a workers comp settlement, for better or worse, include the following:
- The parties’ willingness to compromise: Some attorneys, insurers, employers, and claimants view the negotiation as a “win-lose” contest, begrudgingly giving up ground. If the litigants are more willing to hear the other side’s arguments and compromise, settlement may happen sooner.
- The employer’s involvement: Usually, the insurance company decides when to offer to settle and how much. But larger companies may be self-insured or have self-insured retention, giving them more say in the settlement process. In our experience, claims involving employers who have to pay all or part of the lump sum directly take longer to resolve.
- Disputes over compensability: You may receive a settlement offer sooner if the parties agree the Workers Compensation Act covers your accident and injury. Otherwise, a trial and appeals may be necessary to decide the factual issues and determine eligibility before the insurer focuses on settlement.
For more information on whether a lawyer can help you speed up when you receive a settlement offer and improve that offer, read our article: When Should I Hire a Workers Comp Lawyer?
When Will the Insurer Try to Settle My Workers Compensation Case?
Each workers comp claim has several milestones, or plateaus, where the insurer may offer a settlement before moving to the next step in the litigation.
The following sections look at each plateau and the pros and cons of settling at these points.
Soon After You Report the Injury or File a Claim for Benefits
Many workers comp adjusters will offer a settlement within days or weeks of you reporting the work injury to your employer or filing a claim for benefits with the Workers Compensation Commission.
Indeed, the adjuster may tell you they want to take a recorded statement, enticing you by saying they will make an offer to settle after reviewing their notes from the phone conversation and medical records.
These insurance representatives will use any financial information you give them (such as your concerns about paying bills while you heal) to resolve the claim cheaply.
Insurance companies have several other reasons for making a quick settlement offer. For example, the adjuster may want to close the case before you:
- Realize the workers compensation benefits you are entitled to
- Figure out the nature and extent of your injury and disability
- Know your projected future medical expenses
Adjusters fear that the longer the claim stays open, the higher the insurance reserves will need to be.
This being said, sometimes you have enough information and documentation, such as witness statements, safety reports, and medical opinion statements on disability and causation, to settle soon after you file your claim.
For example, settling soon after the accident makes sense if the insurance carrier has valid defenses to your workers comp claim, making you unlikely to get benefits.
Similarly, settling within a few weeks or months of the accident is okay if your treating doctors confirm the injury was minor and you heal fully.
But remember – never accept the first offer.
Before Pretrial Discovery Ends
Pretrial discovery (interrogatories, requests for the production of documents, requests for admissions, depositions, subpoenas, etc.) serves many purposes.
One of these purposes is speeding up when workers comp offers a settlement.
For example:
Forcing the employer and insurer to gather and produce documents, answer written questions, make witnesses (including claims adjusters, nurse case managers, and vocational rehabilitation counselors) attend depositions, and admit facts that weaken their position is costly and time-consuming. Indeed, litigation discovery can disrupt a company’s operations significantly.
Further, the defendants may realize they ignored your spoliation letter and destroyed evidence they should have preserved, opening them to adverse inference for spoliation at trial.
In contrast, most injured workers have few documents to turn over and can answer the relevant questions in litigation quickly.
Therefore, some insurers will offer a workers comp settlement during the discovery phase to avoid incurring the ongoing expense.
After Pretrial Discovery Closes
Some insurers wait to offer a workers comp settlement until their attorney takes your deposition and you answer interrogatories.
Once discovery ends, the parties should know all the facts and be able to predict how a judge will decide the case at a workers comp hearing or the reasonable settlement range.
At a Settlement Mediation Conference
Alternative dispute resolution methods, such as mediation and arbitration, have become more popular over the past decade.
And mediation has a high success rate in workers compensation matters – more than 80 percent of full and final mediations result in settlement in Virginia (see a sample mediation statement here).
In our experience, some claims adjusters wait to offer a workers comp settlement until the mediation to get feedback from the mediator. The mediator’s evaluation and statements can help the adjusters or defense attorneys justify the settlement amount to supervisors.
Days Before the Scheduled Trial
Many civil cases settle in the days before trial when the insurer realizes it cannot delay the risk of losing any longer.
Some even resolve on the courthouse steps.
Workers comp claims are no exception.
Usually, the days leading to a workers comp hearing are when reality sets in. And both parties realize that the claim’s value will change dramatically – for better or worse – depending on the judge’s decision.
This fear may motivate the workers compensation insurer to offer to settle to maintain some control before a third party decides the dispute.
After the Workers Compensation Hearing But Before the Judge Issues an Opinion
In a civil trial that decides liability and damages in a car accident or a product liability lawsuit, the judge or jury renders a verdict after the parties submit evidence and give a closing argument.
But you rarely receive a decision on the day of trial in workers compensation.
Indeed, you may have to wait days, weeks, or even months to receive the judicial opinion.
This delay gives the parties time to reconsider their settlement positions after seeing how the witnesses performed at trial and listening to the deputy commissioner’s questions.
And the claims adjuster may offer a settlement while you await the decision.
When the Doctor Prescribes Surgery
Surgery is expensive.
And insurance companies often deny the authorization of surgery for a work injury to avoid this cost and bring you to the negotiation table, even when you have a Workers Compensation Award Letter providing lifetime medical benefits.
Indeed, many of my clients receive their first settlement offer after their doctor recommends surgery.
If you have private health insurance or Medicaid to cover the cost of any prescribed operations, now could be an excellent time to settle.
But first, read our article on the advantages and disadvantages of settling before surgery for more information.
After You Reach Maximum Medical Improvement (MMI)
The insurer will likely make a settlement offer when you reach maximum medical improvement (MMI) if you get ongoing wage loss payments under an award.
MMI means your recovery has plateaued. And this milestone is when you can determine your permanent work restrictions, level of permanent impairment, and future medical expenses.
Some of you will reach MMI within weeks of the injury.
But others will take several months or years before a doctor declares you have reached maximum medical improvement, mainly if you need multiple surgeries or a spinal fusion or joint replacement.
When the Employer Cannot Accommodate Your Light-Duty Restrictions
Your work injury may prevent you from returning to your pre-injury job. For example, head trauma (including concussions), back injuries causing or worsening herniated discs, amputations, and burns may force you to change careers.
Some big employers, such as Amazon, Target, Walmart, and hospitals, can accommodate light-duty restrictions temporarily.
But others, including many retail businesses, construction firms, and trucking companies, do not have light duty available for injured workers.
The insurer may ask if you want to settle your claim when it finds out your employer will not offer a new position.
When Your Employer Terminates Your Position
Many insurers and claims administrators ask injured workers to resign as part of a settlement.
This requirement is a barrier to settling if you want to return to the employer after the doctor releases you to some work or have already returned.
This barrier no longer exists if the employer terminates your employment.
And the termination may prompt the insurer to offer a settlement.
However, we recommend speaking with a labor lawyer to determine if you have a remedy under employment laws before accepting any settlement offer. For example, you may have separate causes of action for workplace retaliation or violating your rights under the Family and Medical Leave Act (FMLA) or the Americans with Disabilities Act (ADA).
When You are Close to the Cap for Indemnity Benefits and Have a Viable Permanent and Total Incapacity Claim
You must pass a high bar to receive more than 500 weeks of indemnity benefits (combined temporary total, temporary partial, and permanent partial disability) in Virginia.
But you can do it if you have the following:
- High impairment ratings for more than one extremity (such as 100% loss for an amputation injury involving one arm and 50% impairment for the loss of use of the other arm due to overuse); and,
- Vocational expert testimony (including a labor market survey) on the difficulty of finding work with your restrictions
These benefits are called permanent and total incapacity payments.
And claims for these benefits are often disputed because so much money is on the line, particularly if you have a long life expectancy.
This risk may motivate the insurer to offer to settle.
Settlement Offers When Your Social Security Disability Application is Pending, or You Are Not Yet Medicare Eligible
You may apply for Social Security disability benefits if your occupational injury prevents you from returning to your regular job.
Indeed, you can get Social Security disability insurance (SSDI) and workers comp benefits simultaneously.
And you can even get SSDI after settling your workers comp case.
But qualifying for Social Security disability could complicate a workers compensation settlement because an award of SSDI benefits means you will become Medicare eligible. And the Medicare Secondary Payer Act requires the parties to a workers comp case to consider Medicare’s interests when settling or, in some situations, obtain Medicare approval for the proposed medical allocation.
Obtaining the Centers for Medicare and Medicaid Services (CMS) approval for a proposed Workers Compensation Medicare Set Aside Arrangement (WCMSA) is time-consuming and expensive.
In addition, Medicare’s review could prevent the settlement from proceeding if it determines the WCMSA is inadequate, and the insurer is unwilling to fund additional monies.
The insurer, therefore, may offer to settle the occupational injury claim when your disability application is pending or after you qualify for SSDI but before you are Medicare-eligible to avoid this cost and risk.
Do All Workers Comp Cases End in a Settlement?
No.
We cannot guarantee that workers comp will offer a settlement.
But the statistics show that many occupational injury claims end with a compromise and release.
What Happens If I Do Not Get a Settlement Offer?
Some workers comp cases never end.
And others settle, but only after years of disputes.
If the insurer does not offer a settlement, you will continue to receive benefits under the Award Order or judicial opinion.
Or, you will go to trial to get the medical care and payments you deserve.
Helping You Build a Case that Motivates the Workers Comp Insurer to Offer a Settlement
You cannot force the insurance company to settle your workers compensation case.
But you can act in ways that motivate and encourage the insurer to close your case by a compromise and release settlement. And you do this by developing evidence that persuades the insurance company it will have to pay you a lot of money if the claim stays open.
Call now so that we can get started with your case: 804-251-1620 or 757-810-5614.
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