Travelers Insurance recently passed Liberty Mutual to be the largest workers compensation insurance carrier in the United States. Coming from the length and breadth of knowledge and experience that comesfrom yearsof handling comp claims, Travelers published their list of 5 common workers comp myths from a small employer’s perspective:
1. “I only have a few employees so I don’t need comp insurance.”
2. “My employees won’t sue me.”
3. “Comp insurance is too expensive so I’ll just pay out of my pocket if an injury occurs.”
4. “I provide a safe workplace so my employee’s won’t get injured.”
5. “Medical costs in the workers comp system are just too high.”
While these myths do exist and are quite prevalent, I often see an additional five myths from my perspective as a workers comp defense attorney:
1. Every Injured worker needs an attorney.
While it is true that many injured workers do need to hire an attorney, there is certainly no need for most to obtain counsel. Most states have systems in place to resolve the claim directly with the injured worker without the time and expense associated with the claimant hiring an attorney and filing a formal claim.
The complaint against injured workers representing themselves is what gave rise to that old joke: “A person who acts as his own attorney has a fool for a client.” I agree that most claimant’s don’t know as much comp law as does the average claimant’s attorney. That shouldn’t come as a shock to anyone. But that doesn’t mean that every injured worker needs an attorney.
Most comp claims are compensable (if you don’t agree…sent Myth 5 herein). As such, the only issue in most claims is the nature and extent of impairment of disability. Does this mean that final settlement amount for an unrepresented claimant is always the same as in cases where the claimant has retained counsel? Obviouslynot, but that doesn’t mean that the claimant gets less money.
Remember that in most jurisdictions, claimant’s attorneys take between 20% – 33% of the final settlement as a fee. Add in a few thousand dollars for an IME report and discovery costs and you can see how the fees and expenses go up faster than the winnings on Wheel of Fortune.
If the claimant resolves the permanent partial disability portion of the claim on his own, he can afford to accept a lot less money for the final settlement amount and still take home nearly the same amount when compared to what he would actually receive if he had retained counsel and paid the fees and expenses out of his final settlement.
Additionally, there is also the time value of money consideration. Claims where the injured worker is represented often take years to resolve, not weeks or months. Which is better to receive – – $10,000 today or $12,000 three years from now? Most people would chose the former over the latter and by resolving claims directly with the insurance carrier without hiring an attorney, injured workers are virtually guaranteed to get their money faster than if they retain counsel.