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What is the Average Workers Comp Settlement?

The average workers’ comp settlement amount is approximately $21,946.62, which was derived from retrieving settlement amounts in workers’ compensation cases that were settled in the last 5 years (between 2016 and 2021). This figure may be comparatively high next to national averages in the United States because the data includes more settlements with serious work injuries. Generally, the average workers’ compensation settlement is between $2,000 and $40,000, although some may settle for millions.

This average should not be interpreted as a standard settlement amount for every workers’ compensation settlement. The circumstances surrounding work-related injuries are unique, and so are the characteristics of each claim. As a result, settlement values will vary depending on many factors of the work-related injuries. The most pivotal factors in determining the value of a claim is the type of injury, the treatment required, such as whether surgery was required, physical therapy was deemed necessary, and the resulting disability. The disability is generally expressed as a percentage, so if something terrible happens, and a limb is amputated, the disability would be 100%. However, if you suffered merely a laceration, then the disability might be none or slight. 

Current and future medical care costs may also play a large role in determining the value of a settlement. As these costs increase, the financial detriment to the injured party increases as well, thus, increasing the need for higher compensation.  

There are several other factors that contribute to the final settlement value of a workers’ comp claim. Hiring an experienced attorney is the most effective way to assure that your entitlement to adequate compensation is assessed appropriately. 

How Workers’ Compensation Settlements Are Calculated

A large contributor to the total settlement amount when calculating workers’ compensation settlements is the severity of injuries. 

Workplace accidents may be broadly categorized as follows:

  • Soft tissue injuries – Includes sprains, strains, and contusions
  • Complex injuries – Broken bones and lacerations
  • Severe injuries – Permanent disfigurement, brain injury, spinal cord injury, or death

Workers who have suffered more severe injuries will generally experience higher settlement amounts than those who suffered an injury like a sprain or contusion. This is often because of higher medical expenses and lost wages due to an inability to work.

Factors used to calculate workers’ compensation settlements include:

  • Injury severity
  • Pain and suffering
  • Medical expenses (current and future)
  • Lost wages
  • Fault & negligence

Workers’ Compensation Settlement Agreement

A workers’ comp settlement is the most common legal resolution that follows a workplace injury. The settlement typically involves the liable party, in this case your employer or more commonly, their workers’ compensation insurance company paying a sum to the injured party for an amount of money agreed upon by the parties involved and their respective representatives. Settlements are usually delivered in one payment, but recurring (structured) payments may be available as well.

Although states may differ, most states will have workers’ compensation settlements that include benefits for medical treatment (and future medical expenses) and lost wages.

While a workers’ comp settlement is the most common remedy to a workplace injury claim, it is important to note that settlements are also voluntary. You should not feel pressured to agree to a settlement below what you deserve. Generally, it is not wise to settle until you have undergone all medical treatment and consulted a lawyer regarding your workers’ comp case.

Additional Considerations for Workers Compensation Claims, Benefits, And Settlement Amounts

Each state has governing laws and regulations for workers’ compensation benefits, which may be categorized as follows:

  • Temporary Total Disability (TTD) – The injured employee will be paid a set percentage of their salary during the time they’re unable to work because of injuries.
  • Temporary Partial Disability (TPD) – Awarded to workers who can return to work but with certain restrictions. This generally means that the injured worker will return to work but will not be eligible to earn more than a set percentage of their pre-injury wages.
  • Permanent Total Disability (PTD) – The injured worker is unable to work in their own or another occupation that aligns with their education, training, trade, or experience.
  • Wrongful Death Claims – Individuals who suffered a fatal injury at work are often compensated with a lump-sum settlement awarded to the surviving family, which is in addition to any pre-existing pension or death benefits. Emergency personnel may have separately defined benefits if injured in the line of duty.

Depending on your claim, workers’ comp benefits and compensation may be structured payments or a lump-sum settlement that covers existing medical bills, future medical care, and lost wages.

A workers’ compensation lawyer will help you understand the laws that apply to your state along with the complexities and considerations of your unique case. Additionally, a lawyer will help file your workers’ compensation claim and negotiate your workers’ comp settlement to maximize your compensation. One of the goals of creating workers’ compensation insurance was to make it easier for the injured worker to obtain medical care immediately regardless of whether the individual has health insurance. Despite this goal, workers compensation claims can be extremely intricate. 

A good default rule would be to hire an attorney for any workers’ compensation claim. The need for an attorney is multiplied when the injury leaves you with a permanent disability, if the insurance company disputes your claim, or if the exact cause of your injuries is in dispute.  

It is wise to contact an attorney with any questions you may have regarding the claim. Workplace injuries can be devastating, and an experienced attorney will assure you receive the best possible compensation with the lowest possible amount of hardship. 

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