Workers Compensation Lien on a Personal Injury Settlement
Worker’s compensation is a legal right when you, unfortunately, get injured on the job. The employee worker’s compensation should ideally cover any expenses related to workplace injuries. This includes medical bills, treatment facilities, and loss of wage. Stay with us to know more about Worker’s Compensation Liens in a Personal Injury settlement.
As you are covered by worker’s compensation insurance, you cannot sue your workplace in times of workplace accidents. However, this law cannot be claimed when your injury may have caused by someone’s negligence. In such situations, you can sue the third party on your own.
This way, you can acquire compensation for the amount the insurance will not cover. However, the workers’ compensation insurance will assert a worker’s comp lien on a personal injury settlement.
What is a Workers Compensation Lien?
First things first- what is a lien on a settlement? For this, we need to understand the worker’s compensation claim clearly.
Workplace injuries are one of the most common things that can happen in an office or industry. A practical matter is that you are covered by worker’s compensation insurance as an employee.
The workers’ compensation insurance will cover all the expenses related to workplace injuries. This involves a wide array of bills, costs, and income loss. The only condition is that you cannot sue your employer for the injuries you sustain from workplace injuries.
However, the workers’ compensation insurance only covers any expenses caused by workplace injuries. You will not receive actual money in your pocket from worker’s compensation. Since you cannot sue the employer, you have no other option to carry the expenses of recovering from the injuries.
But this is not exactly what you have in your hand. You can sue a third party for personal injury claims. Suppose you are injured by a driver who was driving the company’s car. You can sue that driver on your own through a personal injury compensation claim.
However, the workers’ compensation has a lien put over the personal injury settlement.
This means that the insurer can claim reimbursement from the personal injury case settlement. As a result, the insurer is entitled to receive a small amount of your personal injury case winning.
This is called claiming a worker’s compensation lien on the personal injury settlement.
Understanding the Workers Compensation Lien in Job Injury Cases
A lien is a legal right to the insurance providers. The technical definition of “Lien” is when a creditor obtains a security interest over the property of another party. It is an integral part of worker’s compensation insurance coverage.
The insurance provider to the works compensation claim can claim a part of the settlement amount from the personal injury case settlement of the worker. This can be claimed for the same accident that the insurance covered for initially.
This is an effective way to recur the insurer’s costs for covering the workplace injuries to the worker. In addition to this, a workers compensation lien is a great way to find out the actual party responsible for the workplace injury.
The Workers Compensation Case
The first thing after a workplace injury is claiming the workers’ compensation insurance coverage. As the name suggests, this is an insurance claim. Therefore, the insurance will cover expenses regarding the injuries only. This typically means you can claim the insurer to pay medical bills incurred from the injuries.
If you are injured on the job, the workers’ compensation will cover medical and treatment expenses, lost wages, and rehabilitation costs. In some states, the worker may also be entitled to receive death benefits if he or she is killed performing a workplace responsibility.
The workers’ compensation insurance works as a no-fault program. This means that you do not have to follow the tort route to prove that your employer’s negligence caused the injuries. If you are hurt in the workplace, the insurance will typically cover the expenses without any hindrance. In return, you cannot sue the office or the employer.
Workers Compensation 3rd Party Settlement
When you are injured in your workplace, you are covered by worker’s compensation insurance. However, you can still file a lawsuit against a 3rd party for personal injury compensation. In such cases, the workers’ compensation insurer is entitled to claim a lien amount on the 3rd party settlement.
There are several factors to consider. This involves the employee, employer, and the insurer altogether.
Firstly, the employee should inform the employer that a third-party lawsuit has been served. The employee must include a copy of the lawsuit to the employer and the insurer. Other documents relevant to the lawsuit can be attached.
After that, the employer has three options. The employer can file a notice of lien, bring direct actions against the 3rd party, or intervene in the personal injury case.
If the employer only files a lien settlement letter, the insurer can earn a low amount of money. This amount equals the negotiated lien amount minus every cost regarding the worker’s personal and lawyer expenses.
In such a case, the employee can settle with the 3rd party on his or her own. The only thing to ensure is that the settlement amount is not a part of the insurance coverage. The insurer will receive the negotiated lien amount from the settlement amount.
Negotiating the Lien Amount
A worker’s compensation insurer will be happy when you bring a 3rd party lawsuit. This allows the insurer to recover the insurance coverage they paid you for the workers’ compensation insurance.
Both worker and the insurer need to be on the same page regarding how much money will be circulated throughout. The insurer cannot claim a massive amount of money as the lien amount. Suppose the claimed lien amount is more than the face value of the personal injury settlement. In that case, the worker may even decide not to pursue the case in the first place.
As you can see, there is an opportunity to negotiate the lien amount with the insurer. Negotiations are complex jobs. It requires an extreme skillset and communication knowledge. Therefore, you can hire an attorney to negotiate with the insurer.
The negotiation should involve deciding on a lien amount that covers some amount of the insurance coverage of the insurer and leaves a substantial amount for your personal injury compensation. You may utilize that money to recover from pain and sufferings that the workers’ compensation would not cover.
The wisest option is to hire a professional and skillful lawyer. Eventually, you may get a better amount than the insurer’s lien amount and still benefit from the insurance coverage.
Workplace accidents can often bring life-threatening injuries to a worker. It is always smart to hire an attorney as soon as possible after workplace accidents take place. You’ll easily be covered for your injuries by the workers’ compensation insurance.
Suppose you intend to sue a 3rd party for your injuries. In that case, that is when the legal works can get complicated with a worker’s compensation lien on a personal injury settlement.