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Definition of Settlement

Settlement is defined as an adjustment, arrangement or other understanding that is reached. As it applies to workers' compensation, a settlement is when an injured worker and their employer or their employer's insurance company reach an agreement on the amount, extent and type of compensation that will be paid regarding the workers‘ compensation claim that has been made for the worker's work-related injury or illness.

It should be understood that every workers' compensation settlement is completely voluntary. An injured worker does not have to agree to accept any settlement offer that is made by their employer or their employer's insurance company. In the same way, an injured worker's employer or their employer's insurance company does not have to agree to settle that worker's claim. When considering a settlement offer, an injured worker should know what rights they are relinquishing as part of accepting the proposed settlement offer and what workers' compensation benefits they are entitled to. An injured worker should also know that there are various types of settlements that can be made that vary from state to state. Because of this, it is a wise idea for an injured worker to have a workers' compensation attorney representing them to help determine which is the right type of settlement for that worker.

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