Most Kentucky workers' comp claims eventually settle. The decision to settle is an important and personal one. Before you give up your right to workers' comp benefits, you should carefully weigh the advantages and risks involved. While a lump sum payment might help you pay your bills and provide financial stability, a settlement also closes your claim for good.
When you settle a workers' comp claim, you give up certain rights in exchange for a sum of money. In Kentucky, most settlements are paid in a lump sum. However, in some cases, settlements are paid out over time. For example, if you don't have a sufficient source of income, you might receive weekly payments for an agreed-upon number of weeks instead.
Unlike in some states, settling a Kentucky workers' comp claim doesn't necessarily close out your case for good. Unless you specifically waive your right to reopen your workers' comp case in the settlement agreement, you can ask for additional compensation if your condition worsens within four years. Likewise, unless you waive your right to future medical care, your treatment will continue to be covered by workers' comp even after you settle.
If the insurance company has accepted your claim and is voluntarily paying benefits, you can request payment in a lump sum. Sometimes called a "commutation," this essentially functions as an advance on your benefits. In these situations, your weekly benefits will be added up and then reduced by 1% to bring them to their present value.
The discount percentage is set annually by the Department of Workers' Claims; you can view the state's settlement discount tables at the Department's website. And, if you need help calculating the discounted value of your benefits, contact a lawyer.
All workers' comp settlements must be approved by the Kentucky Department of Workers' Claims. To finalize a settlement, you must file an Agreement as to Compensation and Order Approving Settlement with the Department. Depending on the nature of your claim, different forms are used:
These forms ask for information about your injury, your medical expenses, your wages, the amount of your settlement, and which rights you are giving up. Once the Department receives your signed agreement, an administrative law judge will review your settlement. Typically, the judge will approve your settlement unless it is clearly unfair or unreasonable.
The value of your settlement depends on several factors, such as your pre-injury wages, your impairment rating, and whether you can return to work. To get an idea of how much you might be entitled to, read our article explaining the different types and amounts of workers' comp benefits in Kentucky. However, the value of your case will also depend on other factors, such as whether there is conflicting evidence in your case. If you are waiving certain rights (such as the right to reopen or to receive future medical benefits), you will typically negotiate an additional sum for this waiver.
Certain items will be deducted from your settlement check. Depending on the nature of your claim, these costs may include:
To learn more about these deductions, read our article discussing how much of your settlement you will get to keep.
In Kentucky, you can settle your workers' comp claim at any time. However, it can be very difficult to properly value a settlement while you are still healing. That's why most workers wait to settle their claims until they reach maximum medical improvement—when your doctor declares condition is stable and will no longer improve with treatment.
Additionally, you should seriously consider speaking with a Kentucky workers' comp lawyer before you settle. Unless your claim is very simple, you might make costly mistakes when calculating and negotiating a settlement on your own. An experienced lawyer will help you receive a fair settlement and prevent you from giving up essential rights. To learn how much this might cost you, read our article about Kentucky workers' comp attorneys' fees.