Injured workers in California are often faced with many decisions, in addition to having to take time to heal from their injuries. Some of these decisions pertain workers’ compensation.
In this post, we discuss the difference between accepting a settlement or continue receiving weekly benefits. Understanding these different options is critical for injured California workers and their families.
Weekly benefits
Often referred to as temporary disability benefits, weekly benefits are payments made to injured workers who cannot work because of a work-related injury or illness.
Settlements
A workers’ compensation settlement is a lump sum payment that resolves the injured employee’s claim for benefits, including medical expenses, lost wages and other related costs.
Key differences
The primary differences between weekly payments and a settlement are:
- Weekly payments are paid over time, providing a steady income during recovery, while a settlement can be beneficial for managing expenses all at once.
- Weekly benefits are temporary and are only intended to last while the employee is recovering. Settlements, however, can provide a one-time payment.
- Accepting a settlement usually means that the injured employee forfeits any rights to future medical benefits; that is, it is typically a one-time payment.
- Settlements provide closure to your claim, allowing you to distribute the funds as you wish. However, you must spend it wisely. Weekly payments do not allow you to spend such a significant amount at once, which means that if you are tempted to spend more than you should on one thing, you cannot if you are receiving weekly payments.
- There is a risk and reward in receiving a settlement and in getting weekly payments. Settlements can be attractive because they provide you with a lump-sum right away, but weekly payments provide you with stability and certainty that you will have continued income coming in.
Choosing between a workers’ compensation settlement and weekly payments is a profoundly personal decision that should be made carefully. Discuss your options with your attorney before making any decisions, and have as much information about your injury and treatment plan as possible.
Understanding the differences between these two forms of compensation is important, but it is also critical to know yourself. You must consider your attitude toward money when thinking about whether it is wise to opt for a settlement instead of weekly benefits.