If your employer's insurance company has denied your workers' comp claim or hasn't approved all of the benefits you think you deserve, you have a right to appeal that decision by filing an "application for adjudication of claim" (see how to file a California workers' comp claim for details). However, only a small portion of disputes end up going to a hearing before a workers' comp judge. Most of the time, insurance companies and injured employees resolve their disagreements by reaching a settlement. Throughout the course of your case, you'll probably have several opportunities to negotiate with your employer—or more likely its insurance company.
The wisdom of accepting a settlement offer will depend on several factors, including the amount of money being offered, the severity of your injury and resulting permanent limitations, the strength of your medical evidence, your financial situation, and your willingness to wait it out longer. On the one hand, if the offer is good enough and you need the money now, it might be worth accepting a lower amount to avoid the hassle and time it takes to go through a workers' comp hearing. On the other hand, if the insurance company insists that you're less disabled than you think you are, and you have reliable medical evidence supporting your claim, it may be worth trying to convince a workers' comp judge to award you more benefits.
Before considering a settlement offer, you should at least wait until your medical condition has stabilized (a stage called "maximum medical improvement" or "permanent and stationary"). Until then, you won't know how much your case is worth. Once your physician says that you won't improve any further, even with more treatment, the doctor will decide whether and to what extent your injury has caused permanent limitations that would result in a permanent disability award. (For more on how this process works, see our article on getting workers' comp permanent disability benefits in California.)
In California, there are two ways to settle your workers' compensation case: a "compromise and release" or "stipulated findings and award."
With a compromise and release, you are agreeing to close out your workers' comp case for good in exchange for a lump sum payment. This means workers' comp won't pay for any future medical care related to your injury, and you won't be able to reopen your case if your condition gets worse. In return for that uncertainly, however, you'll receive a larger payment up front and won't have to take your chances at a hearing.
A compromise and release is final. As long as you signed the agreement voluntarily, workers' comp judges usually won't let you take it back—even if you end up needing more money later. So before agreeing to this type of settlement, make sure that your condition is stable and that either:
If you settle your case with a stipulated findings and award, you and the insurance company will agree on the extent of your permanent disability and the amount of your benefits. You'll receive biweekly payments rather than a lump sum—unless you can show a financial need for part or all of your benefits to be paid up front. This type of settlement has two advantages:
Any settlement that you agree to will need approval from a California workers' comp judge. You—or your lawyer, if you have one—will file paperwork with the California Workers' Compensation Appeals Board detailing the terms of the agreement. A judge will usually hold an informal hearing to make sure you understand the agreement and that the terms are fair. If the judge approves the settlement, you will receive your lump-sum payment within 30 days.
Unless your injury was minor and you healed completely, you should consult with a lawyer before settling your case. This is especially true if you are considering a compromise and release, which will take away your right to seek additional benefits or medical treatment in the future. A lawyer can tell you how much your case is probably worth, evaluate settlement offers, and negotiate with the insurance company for a higher sum. A lawyer can also make sure that the settlement agreement doesn't ask you to waive any rights that you shouldn't give up. If you're also receiving Social Security disability insurance, your attorney can save you money by making sure the settlement minimizes how much workers' comp benefits will lower Social Security payments. To learn more, see our article on what a good lawyer can do for you in your workers' comp case.