Q: What is a lump sum settlement?
If you are currently dealing with a workers' compensation claim, your insurance company may have mentioned the option for a lump sum settlement; this is also known as a Compromise and Release. A lump sum settlement is just what it sounds like: the insurance pays you one big chunk of money all at once and then washes their hands of their financial obligation to you.
When you receive workers' compensation benefits, you will usually get a set amount per week until you are medically cleared by your doctor. The lump sum settlement gives you everything at once.
Is accepting the lump sum a good idea? It really depends on your situation. Some people don't like not knowing how much they will ultimately receive over the course of their weekly payouts and just prefer to get everything at once. However, before you get blinded by dollar signs, it is important that you step back and look at the big picture. What happens if they don't offer you enough money and you run out before you can go back to work? Does the money cover future medical bills? What if your condition worsens?
In most situations, the workers' compensation insurance company is probably going to try to give you an amount of money that is less than you deserve. If you're not sure whether or not you want to take a lump sum, one of the best things you can do for yourself is to hire a workers' compensation attorney. You will have a legal professional on your side and the insurance company will be less likely to try and take advantage of you if they know you have a lawyer.
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