The Losses Covered in a Workers' Compensation Settlement

By Sara Canning

According to the National Safety Council in 2022, workplace injuries in the U.S. cost businesses over $171 billion. This comes in the form of compensation to employees who get injured or become ill due to their job. It shows how significant workers' compensation is for both employees and employers.

Workers' compensation is an important system that helps employees recover after workplace injuries without fear of financial ruin. Understanding the losses covered and calculating damages in a workers' compensation claim is important for both employers and employees.

Understanding Workers' Compensation Settlement

Workers' compensation settlements are often reached between the injured worker and their employer's insurance company, either through negotiations or legal proceedings. The amount is typically based on the severity of the injury, the extent of recovery, and potential long-term effects on the worker’s ability to perform their job.

It is often advisable to consult a worker's compensation attorney to ensure fair compensation and protect the employee's rights. By seeking legal guidance, workers can maximize their settlement and ensure all damages are accounted for. These losses may include:

●     Medical expenses

●     Lost wages

●     Rehabilitation cost

●     Death benefits

Medical Expenses

One of the primary losses covered by workers' compensation is medical expenses. If you’re injured at work, your medical bills can quickly add up. Workers' compensation ensures that employees don’t have to pay for these costs out of their pocket. It’s important to note that workers’ compensation usually only covers treatments related directly to the work injury. For example, if you hurt your back while lifting a heavy box at work, the insurance would cover your back-related medical treatments.

Covered medical costs include:

●     Doctor visits

●     Hospital stays

●     Surgeries

●     Physical therapy

●     Medications

●     Medical equipment (e.g., crutches, braces)

Lost Wages

When an injury prevents an employee from working, workers' compensation provides wage replacement. The amount usually equals two-thirds of the worker's average weekly earnings. Depending on the severity of the injury, benefits may cover temporary total disability, temporary partial disability, permanent partial disability, or total permanent disability, helping to mitigate the loss of income during recovery.

Rehabilitation Costs

Injuries often require ongoing rehabilitation, including physical and occupational therapy, to help the employee regain function. Workers' compensation covers both physical rehabilitation and, in cases where an employee cannot return to their previous job, vocational rehabilitation. Vocational rehabilitation is particularly important for workers who must change careers or take on new roles as a result of permanent disabilities.

Death Benefits

In tragic cases where an employee dies from a workplace injury, workers' compensation provides death benefits to the employee's family. These benefits help the family cope financially after the loss of their loved one. It typically covers funeral and burial expenses, along with financial support for the family.

The amount and duration of these benefits vary from state to state, but they are generally meant to replace the income the deceased worker would have provided. The primary beneficiaries are usually the spouse and children who are dependent on the deceased worker. In some cases, other family members may also qualify if they are financially dependent on the worker.