How to Calculate a Settlement in a Workman's Comp Injury

Written by J. Hirby and Fact Checked by The Law Dictionary Staff  

Workman's compensation laws vary from state to state, and the damages calculation process will vary and use different formulas depending on the nature, severity and location of the injury. Nevertheless, the process of calculating a settlement and filing a workman's comp claim is similar from state to state.

It should be noted beforehand that because workman's compensation laws have an easier standard of proof, settlement amounts are often lower than general personal injury claims. There is no workman's comp award for pain and suffering.

Detailed Instructions for Calculating a Settlement

The first step to obtain all copies of accident reports, medical records and witness statements. Your employer is required to file an accident report with your state's workman's compensation agency. For this reason, it is a good idea to wait until your medical improvement has reached completion because you will need to have full medical records for your injury as well as the full balance owed to each treatment facility. This will comprise part of your workman's compensation settlement.

Another part of your settlement will be determined by a percentage rating for bodily impairment, where 100 percent is fully impaired and 0 percent is completely healed. You may get this from a physician's narrative opinion in the final medical report connected with your injury. The regulations in your state will determine the correlation between percentage rating and time to heal for your particular injury as well as the workman's comp wage. The workman's comp wage will be multiplied by the time to heal, and this amount will comprise another part of your workman's compensation settlement.

The final medical report will also estimate the future costs and expenses related to the accident, which will be added to the settlement calculation as well.

Depending on the extent of your injury and/or disability, the company may be required to make disability payments on a permanent or semi-permanent basis. Consult with your attorney to determine your payment schedule as well as the final settlement value. Legal costs and attorney fees may also be included in the workman's compensation settlement.

In some cases, you may need to subtract what is known as "perceived risk." Perceived risk is the risk that an employer may deny liability due to allegations of substance abuse or improper conduct. This amount is different on a case by case basis and is another reason why it is important to consult with an attorney before filing your claim.

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