What describes a lump-sum settlement in workers’ compensation?

A lump-sum settlement in workers’ compensation is characterized by a one-time payment made to resolve the claim, thus enabling the injured worker to receive their benefits all at once rather than through ongoing, periodic payments. This type of settlement allows the claimant to have immediate access to the funds, which can be used for various needs, such as medical bills or living expenses, depending on the circumstances after a work-related injury or illness.

Choosing this route can also signal a final agreement between the insurer and the injured worker, closing the claim and releasing the employer from further liability for that specific injury. The lump-sum payment often includes compensation for lost wages and future medical expenses rather than necessitating ongoing assessments or payments that would occur under a different arrangement.

Other options, such as payments made weekly until recovery or forms of partial disability payments, depict different structures of worker's compensation benefits that do not accurately capture the essence of a lump-sum settlement. Similarly, a decision-making process for future medical care indicates an ongoing relationship with regard to medical management, which contrasts with the finality of a lump-sum settlement.