Workers’ Comp Settlement Process: What You Need To Know

Workers' Comp Settlement Process: What You Need To Know

Michigan lawyer explains the workers’ comp settlement process and how to get the most amount of money.

Many of our clients want to know about the workers’ comp settlement process. They have usually exhausted treatment options and reached maximum medical improvement (MMI). This is a healing plateau where no further improvement is expected from additional interventions. Cashing out insurance benefits seems like a logical next step.

Getting hurt on-the-job can also result in severe financial problems. This is because the insurance only pays a fraction of an employee’s salary. Many people live paycheck-to-paycheck and even a small reduction of income can be devastating. This is a powerful incentive to settle and finish medical and vocational rehabilitation on your own timeline.

The money awarded can be used for any purpose including paying off debt, job retraining, starting a business, or retirement. Here is some information about value, negotiation, redemption hearing, and appeal period that everyone should know.

Workers’ Comp Settlement Process Explained

Settlement Value

The value is going to depend upon future medical needs and how long a person is expected to remain off work. The average amount in Michigan during calendar year 2019 was just $58,641.58. This is not a lot of money for a person who could have lifetime medical problems and/or permeant work restrictions. Generally, a case is worth between 1 and 5 years of wage loss benefits plus medical. It is no secret that lawyers get more money, so it is important to get a professional involved early in the process. Insurance companies know that represented individuals understand their legal rights and have the means to enforce them.


Insurance companies do not want to overpay, and they are ruthless in the workers’ comp settlement process. We have seen insurance companies hire private investigators to follow people just because they mentioned settlement. The negotiation for the amount must be treated like any other negotiation. Obtain medical and vocational evidence before negotiating anything. Expect the first settlement offer to be low and keep negotiating. We have seen first offers that are just pennies on the dollar. Hire a lawyer to negotiate and ensure the most amount of money is paid.

Redemption Hearing

All lump sump payout amounts must be approved by a magistrate. This happens at a redemption hearing and it is a key step in the workers’ comp settlement process. Individuals are expected to present basic facts about their claim and provide medical records for review. There are also several complicated forms and affidavits that must be completed. The magistrate will decide whether the amount is appropriate under the circumstances.

Appeal Period

Once the lump sum payment amount has been approved by the magistrate, there is a 15-day appeal period. Either side can seek to reverse the workers’ comp settlement process based upon a legal reason or other good cause. The 15-day appeal period can be waived if both sides agree and everything becomes final immediately. Checks are sent by U.S. mail and typically arrive 7-10 days after.

Michigan Workman’s Comp Lawyers never charges a fee to evaluate a potential case. Our law firm has represented injured and disabled employees exclusively for more than 35 years. Call (844) 316-8033 for a free consultation today.

Related information:

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Workers\' Comp Settlement Process: What You Need To Know
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