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Understanding Subrogation and your Workers’ Compensation Claim

Workers’ compensation is actually just a form of insurance.  As such, it is a part of a very large, complex, and highly-regulated network of insurance companies.  Like other types of insurance, persons and entities seeking to engage in certain activities (in this case, employ workers) are mandated by law to carry it.  Also like other insurance, the policies written to comply with these mandates are designed to insure against a specific set of harms.  This means that there are other harms that are not insured against, which must be paid by someone else.  In most cases, this means another insurance policy is paying.  Depending on the nature of the incident, the parties involved, who is at fault, and the severity of harm, any number of different insurance policies may be required to pay some portion of the damages.  The process of apportioning these payments among the different insurance policies involved is a highly complex one governed by both the language of the policies themselves, and the principles of equity.

Subrogation Defined

Subrogation is a principle of equity holding that if an insurer pays a claim to its insured for which they were not rightly liable, they are entitled to reimbursement in that amount out of any judgment or settlement ultimately paid out to the insured by the liable party.  This issue frequently arises in cases of automobile and workers’ compensation insurance where it is common for the insurer to pay a claim quickly without respect to fault before a settlement can be reached with the party at fault.

In the workers’ compensation context, subrogation becomes an issue in cases where a third party (other than the employer or the employee) is to blame for the injury, and subsequent tort claims are paid.  In these cases the workers’ compensation claim is often paid out long before the liable third party is held to account.  Often, employers will seek to intervene in these lawsuits to recover the portion of the damages they paid.

Make Whole Doctrine

This does not mean that the employer will always be able to subrogate the injured employee.  When an employer seeks reimbursement for workers’ compensation payments made, they bear the burden of proving complete compensation.  The legal term for complete compensation is to say that the plaintiff has been “made whole.”  It simply means that the damages paid to them fully compensate for the loss they suffered (accounting for medical expenses, lost wages, and all other damages that are legally recoverable).  In cases where full recovery is possible, determining whether a person has been completely compensated is fairly easy to do.  But in the case of a permanent injury, it is much harder to make a judgment as to what exact dollar figure would make them whole.  For instance, a person who loses an arm is never truly “whole” in any sense of the term.  Determining future economic damages is difficult because it is speculative.  Determining noneconomic damages is even more difficult because it seeks to quantify a qualitative change of lifestyle. As a general rule, one may say that the more severe and permanent the injury, the less likely the injured party is to be deemed “made whole” for subrogation purposes.

Contact a Georgia Workers’ Compensation Attorney Today

If you have been injured on the job, you may have multiple remedies available to you, depending on who is at fault and other circumstances of the accident.  However, even if you have a possible lawsuit against a third party, you also likely have a workers’ compensation claim.  Don’t delay.  Call the Atlanta workers’ compensation attorneys at Bader Scott Injury Lawyers today.  A personal injury lawsuit could take several months or even years to resolve.  But we will resolve your workers’ compensation claim quickly and cleanly to make sure your basic needs are met in the meantime.

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Seth Bader
(678) 562-5595