2 Types of Workers’ Compensation Claims

worker accident insurance disability compensation and social benefitsOnce a Utah workers compensation claim has been filed, it will be resolved, either by a hearing before the Utah Labor Commission, or by negotiation between the employee and the employer’s workers’ compensation insurance carrier. If the claim can be successfully settled, the claim will probably take one of two forms: a compromise settlement or a commutation settlement.

1. Compromise Settlements

Compromise settlements are reached with the insurance carrier, usually before the claim can go to a hearing. The parties essentially agree to a compromise settlement. Some issue, often either the question of liability itself or the amount owed remains in dispute. However, both parties concede that it would be more costly and troublesome to continue litigating the issue than settle it for a fixed amount. A compromise settlement often pays a fixed lump sum of money.

2. Commutation Settlements

Commutation settlements can be reached between the insurance carrier and the employee either before or after a hearing. In this type of settlement, an employee is entitled to receive a fixed, periodic amount on a weekly or monthly basis, has the amount commuted, or paid all at once. The lump-sum payment amount is equal to the “present value,” the amount of the payments minus the interest the sum would have accrued over time. The injured employee receives all the compensation at once while the insurance company clears a file from its books. The claim can then be closed.

In both compromise and commutation settlements, the Utah Labor Commissioner must approve any settlement agreement reached by the parties. While it is very likely the Commissioner will approve any settlement reached, the requirement for approval does prevent an insurance carrier from taking too much advantage of the bad situations in which injured workers often find themselves.

At Alta Legal, we have helped many clients reach settlements for workmans comp Utah. If you or a loved one require help from a workers compensation attorney in Taylorsville, UT, contact us today to schedule a free consultation.

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