Detailed Answer
Coordinating benefits between a workers’ compensation insurer and a personal injury settlement in Connecticut requires understanding subrogation rights and lien statutes. Under Conn. Gen. Stat. §31-293, your workers’ compensation insurer holds a lien on third-party recoveries to recover benefits it paid for a work-related injury. This lien covers medical expenses and lost wages paid up to the date of recovery.
To coordinate benefits, follow these steps:
- Notify your workers’ compensation insurer promptly of any third-party claim or settlement. Connecticut law requires written notice to preserve the insurer’s lien. Failing to notify may jeopardize your recovery.
- Calculate the insurer’s lien. Connecticut applies a pro rata reduction. The insurer’s recoverable portion generally equals the benefits paid multiplied by the ratio of your net recovery (after attorneys’ fees and litigation costs) to the total settlement amount. For detailed formula guidance, see Conn. Gen. Stat. §31-293.
- Negotiate apportionment. You can negotiate with the insurer to carve out non-compensable damages (e.g., pain and suffering). Allocating part of the settlement to non-lien damages reduces the insurer’s lien.
- Seek approval from the Connecticut Workers’ Compensation Commission or court. If the parties cannot agree, file a motion with the Commission to determine the lien amount and distribution of settlement proceeds. The Commission can approve a settlement and specify the lien credit.
- Distribute funds. After lien determination, distribute funds: pay attorneys’ fees, litigation costs, reimburse the workers’ compensation insurer for its lien, and retain the remainder.
This process preserves your rights under Connecticut law and ensures fair compensation for both your personal injury claim and workers’ compensation benefits.
Disclaimer: This article provides general information and does not constitute legal advice. Consult a qualified Connecticut attorney for guidance on your specific situation.
Helpful Hints
- Notify your insurer in writing as soon as you file a third-party claim.
- Keep detailed records of medical bills and wage-loss benefits for accurate lien calculation.
- Discuss settlement allocation with your attorney before finalizing any agreements.
- Understand that attorneys’ fees and litigation costs reduce the insurer’s lien proportionally.
- If negotiations stall, consider a Commission hearing to resolve disputes.