When Does Workers’ Comp Offer a Settlement?

A guide to workers’ comp settlement offers, including when they’re offered, how they’re calculated, and key factors to consider

Navigating the complexities of a workplace injury in Montana can be overwhelming, especially when it comes to understanding the potential for a workers’ compensation settlement. If you’re wondering when these settlements are typically offered, how they’re calculated, and what factors should be considered, you’re not alone.

This comprehensive guide aims to help injured workers demystify the workers’ comp settlement process in Montana by exploring the timing of settlement offers, the various factors that influence the calculation of your potential settlement, and key factors to consider before accepting an offer to ensure you’re getting the compensation you deserve. 

Whether you’re just beginning your claim or already contemplating a settlement, this guide will provide the insights you need to make an informed decision about your financial future.

Do all workers’ comp cases end in a settlement?

No, not all workers’ comp cases end in a settlement. Several factors determine whether a case is settled or whether workers’ comp provides ongoing benefits:

• Severity and duration of injury. Cases involving minor injuries that heal quickly might resolve without a settlement, as the worker can return to their job without significant ongoing medical expenses or lost wages.
• Disputes and litigation. If there are significant disputes regarding the extent of the injury, necessary treatments, or the worker’s ability to return to their job, a settlement might be more likely as a means to resolve these disputes.
• Worker’s preference. Some injured workers prefer not to settle and instead continue to receive periodic payments for medical bills and wage replacement. This can be due to uncertainty about future medical needs or a preference for the stability of regular payments.
• Insurer’s strategy. Insurance companies might prefer to settle certain cases to control costs and reduce administrative burdens, but they may also choose to provide ongoing workers’ comp benefits in situations where a lump-sum payment does not seem financially advantageous.

Ultimately, whether a workers’ comp case ends in a settlement varies significantly from case to case and depends on factors like the nature and extent of the injury, the existence of disputes, and the preferences of both the worker and the insurer.

Why would workers’ comp offer a settlement?

Workers’ compensation insurance companies typically offer settlements as a strategic move to mitigate financial risks and streamline their caseload. By providing a lump-sum settlement, they can limit their long-term liability for ongoing medical treatment, lost wages, and potential disability benefits. 

Settlements also eliminate the uncertainty and cost of litigation, as well as the administrative burden of managing an open claim.

When will workers’ comp offer a settlement?

In Montana, workers’ compensation settlement offers are often made after a worker has reached maximum medical improvement (MMI). This milestone signifies that the worker’s condition has stabilized, and further medical treatment is unlikely to significantly improve it. 

At that point, if the worker remains unable to return to their previous full-time employment, the insurance company may offer a settlement to resolve the claim and avoid potential future costs associated with ongoing medical care or disability benefits.

Another time workers’ comp is likely to make a settlement offer is during active negotiations with an injured worker’s attorney when there are disputes about the claim (like the extent of the injuries or the necessity of medical treatment).

Insurers often prefer to settle during negotiations to avoid the expense and uncertainty of a trial. This approach helps both parties reach an agreement more efficiently, ensuring the injured worker receives fair compensation without prolonged legal battles.

Having an experienced workers’ compensation attorney by your side during these negotiations is crucial. They can effectively advocate for your interests, protect your rights, and ensure you receive a settlement that adequately reflects the full value of your claim.

What is the workers’ comp rate in Montana?

In Montana, the workers’ compensation rate is generally two-thirds of the injured worker’s average weekly wage. This means if you were earning $900 per week before your injury, you would typically receive $600 per week in workers’ comp benefits.

However, there are maximum and minimum limits set by the state each year. Your benefits cannot exceed the maximum limit, even if two-thirds of your wage is higher. Similarly, if two-thirds of your wage falls below the minimum limit, you will receive the minimum amount.

For injuries occurring between July 1, 2024, and June 30, 2025, the maximum weekly compensation rate for temporary total disability, permanent total disability, temporary partial disability, rehabilitation, and death benefits is $1,084 per week. For permanent partial disability benefits, the maximum weekly compensation rate is set at $542 per week for the same period.

One significant advantage of workers’ compensation benefits in Montana is that they’re not subject to state or federal taxes. This means that even though you’re receiving a portion of your pre-injury earnings, the lack of taxation often results in a similar amount of take-home pay, helping you manage your finances while you heal.

What should be included in a workers’ comp settlement?

In addition to the wage loss benefits, also referred to as indemnity benefits, mentioned above, there are several other critical factors that should be considered when determining the total value of a workers’ comp settlement. These factors include:

• Medical expenses. All past, current, and future medical costs related to the injury should be accounted for. This includes hospital stays, surgeries, medications, physical therapy, and any necessary medical equipment.
• Lost earning capacity. If the injury results in a permanent disability, benefits should cover the degree of permanent impairment and the impact on your ability to earn a living.
• Rehabilitation costs. If your injury prevents you from returning to your previous job, the settlement should include provisions for vocational rehabilitation to help you acquire new skills and find suitable employment.
• Death benefits. In cases of fatal injuries, benefits for the surviving dependents, including funeral expenses and compensation for the loss of financial support, should be included.
• Legal fees. Any attorney fees incurred while pursuing the workers’ compensation claim or settlement should also be considered in the final agreement.

Properly assessing and including each of these elements is essential to recovering the financial support you need to move forward after a serious work injury. 

Consulting with an experienced workers’ compensation attorney for help with the negotiation process can significantly increase your chances of securing a fair and comprehensive settlement. An attorney can leverage their expertise to evaluate your case, accurately calculate the full value of your claim, and advocate for your best interests during negotiations with the insurance company.

Considering a workers’ comp settlement in Montana? We can help!

The reality is that workers’ compensation claims can be complicated, and there are many factors to consider before accepting a settlement offer, but you don’t have to face the process alone. The team at Murphy Law Firm is here to guide you through the process, ensuring you receive the full benefits you deserve.

With more than 75 years of combined experience, our experienced Great Falls workers’ compensation attorneys have the legal knowledge and negotiation skills needed to effectively advocate on your behalf.

Don’t leave your financial future up to chance. Contact Murphy Law Firm today for a free consultation to find out how we can help you move forward with confidence.

References

Swant, J. (2024). https://erd.dli.mt.gov/_docs/work-comp-claims/claims-assistance/2024-Average-Weekly-Wage-1084.00.pdf