Updated: May 31, 2021
Based on the degree of severity of the injury, the Workers’ Compensation Claims can be broadly classified into 3 categories – Medical, Disability, and Death. This is a broad classification and in reality, types of workers' compensation claims are more precisely classified in 7 categories and 4 of them are subclasses of disability. Before we get in-depth, here is an overview of this article:
Table of Contents
What is Workers’ Compensation?
What is the Workers’ Compensation Law?
Workers’ Compensation Claim
Workers’ Compensation Insurance
Today we will talk about the types of Workers’ Compensation Claims. These types of workers comp claims are categorized according to the severity of the worker’s injury. And based on the severity, the amount and the duration of the compensation are determined.
But before we even get there, some important terms need to be discussed. They will help us see the Workers’ Compensation landscape more clearly.
What is Workers' Compensation?
A worker is an individual who works on the payroll for an employer. And Workers’ Compensation is the benefits that the said worker will receive for his liabilities.
Now, what liabilities are we talking about here?
Liabilities, in this context, mean the monetary losses and health impairments that the worker has sustained. This mostly includes things like the wages for days when he did not come to work, the fee that he paid for appointments with his attorney, and the expenses that he incurred to pay his medical bills.
What is the Workers’ Compensation Law
Every workplace has its own set of safety rules. And the reason they exist in the first place is so that nobody gets injured. But we are not living in a utopian world and humans will always make mistakes and somebody will get injured. Mildly or severely. In an unsafe work environment, people can get injured, even if it is not their fault.
Before the Workers’ Compensation system existed, if a workman got injured at his workplace, things would become complicated for him and his employer. Apart from the pain of his injury, he would also have to bear the loss of time, money, and in some cases, his ability to earn.
As for the employer, he would also be in a very vulnerable position as he is now exposed to litigation and can have a lawsuit from his employee coming his way. The settlement amount of the lawsuit in which the employee and the employer are tied-up can be manyfold higher than the actual amount of money that the employee will lose during his sufferings.
If the employee loses the settlement then he would have lost even more money in the court proceedings and to his attorney. If he wins, then the employer will have to pay a ridiculously large amount of money. This puts both of them in hot waters.
Fortunately, ever since the Workers’ Compensation law came into play, both the employee and the employer can get away with a relative win if a workman is ever involved in an accident at the workplace.
Defining A: Workers’ Compensation Claim
A Workers’ Compensation Claim protects both the employee and his employer.
If a workman ever gets injured while carrying out his employment duties, then he can file for a Workers’ Compensation Claim. The workers’ compensation will compensate for their losses. Workers’ Compensation covers everything from the cost of medical treatments to death benefits.
If you are an employer, then you are in a legally safe place in more ways than one. Your employer can not sue you under the Workers’ Compensation Law. Also, it will become mandatory for you to buy a Workers’ Compensation License or else it would be equivalent to committing a felony if you have a business with employees on the payroll.
But exceptions can always arise, and there can be a case where an employee can get around the Workers’ Compensation Claim and still file a lawsuit against his employer if he thinks that his employer deliberately hurt him.
Workers’ Compensation Insurance: Explained
Workers’ Compensation Insurance works just like any other insurance policy. If someone wants to claim insurance money, then he needs to buy insurance first. Simple as that.
Workers’ Compensation Insurance is the insurance that needs to be purchased so that an employer can pay for the Workers’ Compensation claims. Most employers try to get away with it because they need to keep paying for the insurance, even if there is no injury.
The legal obligation to buy a Workers’ Compensation Insurance has been administered by the state government and the reserves for the Workers’ Compensation Claims are funded by various insurance companies and employers.
One thing to note is the different types of frauds and abuse that occur with the workers’ compensation claims. This insurance, if anything, serves as a legal reminder that says ‘you have been warned’, to anyone who tries to take advantage of the system.
7 Types of Workers’ Compensation Claims
Based on the degree of severity of the injury, the Workers’ Compensation Claims can be broadly classified into 3 categories – Medical, Disability, and Death. This is a broad classification and in reality, they are more precisely classified in 7 categories and 4 of them are subclasses of disability.
But, it is not a hard and fast rule, and it is different for different states. The sorting is done based on wages in some states. The types of Workers’ Compensation claims in Louisiana are classified into three categories – average weekly wage, temporary total disability (TTD), and supplemental earning benefits (SEB).
Types of Workers’ Compensation Claims in California are filed are usually these 5 – medical care, temporary disability, permanent disability, supplemental job displacement, and death benefits.
If we consider all the states, then we have these categories of Workers’ Compensation Claims:
This is the type of claim that is the simplest to file and easiest to process. Mild injuries sustained by the workers that can be treated in a short time and effectively usually correspond to this type of claim. The injured workers can return to work the next or same day, depending on the mildness of injury and the type of service provided.
For instance, if a mechanic at a car repair shop, twists and sprains his wrist while fastening a bolt with a wrench and he is unable to operate the tools anymore, then he may have to visit a doctor. In this case, the mechanic can return to work the next day after his treatment. He can claim as compensation, the cost of his appointment with the doctor.
Temporary Partial Disability
This is one of the more common types of Workers’ Compensation Claim injuries. Here the injured worker is partially impaired for a significant period and he cannot carry out his regular duties during that time. The employer can assign him some light-duty work or he can take time off work.
The cost of his medical treatments and his wages lost during this time will be compensated in the Workers’ Compensation Claim.
An example of this could be an electrician who has fallen from a ladder and fractured his arm. He cannot do his regular duties, like climbing on electric poles, due to his fractured arm but he can do some light duty work like fixing switchboards.
Temporary Total Disability
If the worker injures himself to an extent that he cannot work at all, for some time, then he falls under the TTD (Temporary Total Disability) category. In this case, the diagnosis will indicate a full recovery but during the injury period, the worker is unable to work at all.
Cost of treatments, rehabilitation, and seeing a specialist like a physician or a chiropractor will be covered under this claim besides his replacement wages.
An instance of this could be a worker, who moves parts, breaking the vertebrae in his back that causes him paralysis from the waist down. This worker can recover and walk again after a period of rehabilitation but he cannot work while he is paralyzed.
Permanent Partial Disability
Under the PPD (Permanent Partial Disability) claim, all workers, who have sustained an injury that keeps them from doing their regular duties for life, are covered. These types of workers usually are not retained by their employers and if they are, then they are given a job that is more suited to their reduced abilities.
They continue to get benefits even after they are unemployed because of the loss in their ability to earn. Needless to say, they are covered for their medical treatments and replacement wages.
A factory worker who has lost any of his limbs while operating heavy machinery is one such example. He is impaired for life and he cannot do the job like he used to with severed limbs.
Permanent Total Disability
In this case, the worker has lost his ability to earn because he has sustained an injury that won’t let him perform his usual duties and it is determined that he will never fully recover, then he will be compensated under the PTD (Permanent Total Disability) claim.
He will be compensated for all his medical expenses at the time of injury, he will get his replacement wages, money spent on attorney during the settlement and loss-of-earning-ability-benefit for the period which has been determined in the settlement.
If a worker at a chemical factory loses his vision due to his eyes being exposed to a chemical leak then he will be compensated under the PTD claim.
If there is an unfortunate case where a worker succumbs to death because of his injuries, then his relatives like his children and spouse are compensated because of them being financially dependent on the deceased.
Most states have a procedure to calculate the amount that will be given as death benefit to the deceased workers’ dependents based on his wages. It has a maximum and minimum value but some states can also provide a lump sum to the dependents. Besides this, in some cases, funeral expenses may also be covered.
This is for injured workers who are in the process of returning to work. At the same place or a different place with a similar job. The compensation benefits may cover rehabilitation, re-training or a specialist to cope with the recovery.
Q1. What type of injuries occupies the number one spot for Workers’ Compensation Claims?
Ans1 - The injury that leads to the maximum number of Workers’ Compensation Claims being filed is a sprain. Following sprain are fractures, contusions, cuts and swelling. Falling, slipping, tripping, reckless handling of machines and tools, faulty machines and being crushed by heavy objects are the main reasons why these injuries occur.
Among injuries that do not occur at the workplace but while carrying out employment duties, road accidents are the number one reason for the filing of Workers’ Compensation Claims. It is the number one reason most people get injured or die even on a global scale.
Q2. What are the 3 broad types of Workers’ Compensation Claims and what are the differences among them?
Ans2- The types of Workers’ Compensation Claims can be roughly categorized into 3 categories based on the severity of the injury – medical, disability, and death.
Medical means the injury was not that serious and the injured worker returned to work soon after receiving some minor medical treatments. His treatment costs are covered by the Claim.
Disability means that the injured employer is partially or totally unable to work temporarily or permanently. This is the most common type. The injured worker may remain in the hospital or rehabilitation for a significant period and his hospital bills will be covered and he will get his replacement wages in this claim.
Death means that his children or spouse can claim the Workers’ Compensation benefits as the sole earner of the family may have died
Q3. Which type of Workers’ Compensation Claim is the easiest to process?
Ans3- Workers’ Compensation Claims are never considered easy to process. The severe the injury, the more complicated it gets. That makes the medical-only claims the easiest to process. If it was a disability claim then the claims adjuster would have been involved, the impairment rating would have been calculated and the process would get more complicated.
Q4. What are all the different 7 types of workers' compensation claims?
Ans4- Depending on the seriousness of the injury, the 7 different types of workers' compensation claims are:
Temporary partial disability
Temporary total disability
Permanent partial disability
Permanent total disability
Q5. What type of interventions reduces Workers’ Compensation Claims?
Safety awareness and wellness programs
Appointing a health supervisor
Prompt reporting of injury
Appropriate medical care of the injured
RTW (return-to-work) program
Also Read: Reduce workers compensation costs
Also Read: Prevent False workers compensation claims