Section 32 Agreement and Settlement
Throughout the duration of your workers’ compensation case you will encounter obstacles and opportunities that will need to be carefully evaluated to ensure the best possible outcome for the case as well as for yourself and your wellbeing. One such item to become familiar with and what it means for your case is a Section 32 Settlement.
What is a Section 32 Settlement
Negotiated between the injured worker and the insurance carrier, a Section 32 Settlement will settle the indemnity and/or medical benefits of the workers’ claim. This agreement would end the right of the injured worker to receive ongoing and future benefits in exchange for a lump sum payout or an annuity. Once agreed upon and approved by the Workers’ Compensation Board, the agreed upon settlement (whether it’s indemnity and/or medical benefits) is then closed indefinitely. Once this happens, the insurance carrier will no longer hold responsibility for their part of the claim. In the instance where indemnity benefits are settled, the reoccurring payments for lost wages will cease. Cases in which medical benefits are settled, the insurance carrier will no longer pay for the injured workers’ medical care. It should be noted that a Section 32 Settlement is not binding unless the Workers’ Compensation Board has approved it.
If you decide you want to proceed with a Section 32 Settlement, the following steps must be taken.
- Either your lawyer will contact the insurance company, or the insurance company will contact your lawyer, requesting to settle the claim. If you do not have a lawyer, you will negotiate directly with the insurance company and its lawyer.
- The insurance company will draw up the settlement
- You, your lawyer, and the insurance company must agree on the terms of the settlement
- Once agreed upon, the Workers’ Compensation Board will review the agreement
- The Workers’ Compensation Board must approve the settlement for it to be final and binding
If you decide you no longer want to proceed with the Section 32 Settlement, you have 10 days from the date of submission to withdraw. If you have a hearing, the date of submission is the date of your hearing. If no one withdraws from the settlement in writing, the board will send its final decision after the withdrawal period has ended.
Once the final decision is issued, the insurance company must pay you within the following 10 days. If a hearing is not necessary and the board approves the settlement, you’ll receive a proposed decision. The decision includes the submission date, from which you’ll have 10 days to withdrawal. If no party’s withdrawal, the agreement becomes final. The insurance company must pay you within the following 10 day.
There are cases where the Board will use a desk review process as authorized by Rule 300.36(e) to review Section 32 Waiver Agreements which would ultimately result in approval or disapproval of Section 32 Waiver Agreements.
These instances include:
- Cases that are settling indemnity only and the injured worker (other than a minor dependent) is represented by an attorney, or
- When all parties in the case request a desk review.
The Board would review other settlement requests through a hearing process.
Section 32 Settlement Options
Workers’ Compensation benefits include lost wages and medical care. With a Section 32 Settlement you can settle one while keeping the other open. Or you can settle both, closing your case completely. The decision is up to you and the insurance company.
You can receive one lump sum for your lost wages or an annual payment. Like all workers’ compensation payments, the amount is negotiated between you, the insurance company, and your lawyer. It’s also tax-free. It’s important to remember that this is the last workers’ compensation payment you’ll receive for lost wages, so you should budget it wisely.
Choosing to end your medical care with a Section 32 Settlement means that the insurance company will never pay for your medical care again. You’ll receive a lump sum instead. You may need this money in the future for any medicine, surgeries, or procedures, so make sure you set it aside. If you spend all of the settlement money and still need further care, you can pay for treatments through Medicare or out of pocket.
Deciding if Settling is Right for Your Workers’ Comp Case
There are pros and cons supporting both sides of a Section 32 Settlement; to properly evaluate both sides and determine which is best for your situation you are advised to discuss the settlement with your medical professional as well as your workers’ comp attorney. For example, a settlement could be proposed for an injured worker seeking payments for an amount the insurance carrier feels is too high. In this instance, the carrier could offer to settle for an amount that is less than what the injured party is searching for. No matter the proposed settlement, injured workers are advised to consult with their workers’ comp health care provider in addition to their attorney.
Our workers’ compensation attorneys have a thorough understanding of the laws surrounding workers’ comp cases and have the knowledge to help you achieve a positive outcome with your case. The attorneys of Erwin, McCane & Daly offer a free initial consultation at which time we will give an unbiased assessment of your case.