What is a workers comp lien?


What is a workers comp lien?


A workers compensation lien is a term used to refer to the process of how the claim will be paid. In some situations, an injury that occurs at your place of employment may qualify as both a personal injury legal action and a workers compensation claim. When this happens, the workers compensation insurer may place the term lien on your workers compensation claim. This means that the workers compensation claim is registered to be a claim that is paid out of the proceeds of the personal injury lawsuit.  Generally, this is for certain expenditures that the workers compensation insurer has paid out on behalf of the injured worker.

More Of What You Need To Know

The process of the lien being put into place is also known as subrogation. In this process, the workers compensation insurer claims that the insurer has a right to reimbursement of the funds paid out to the injured employee from the third party who has been shown to be responsible for the loss. Here’s how it may work.

  • You are injured on the job. Your workers compensation kicks in and begins paying out.
  • You sue someone who is to blame for the accident and you win. That person is responsible for paying your medical costs.
  • The workers compensation insurer (the company who paid you workers compensation) files a claim, called a lien, for the funds it paid out to you for the accident with the responsible party.

The process is not as complex as it may sound. However, the funds you receive as a result of your personal injury suit must be used first to repay the workers compensation insurer.


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