In a claim filed under the Defense Base Act, the injured contractor will receive indemnity (compensation) and medical benefits.
Indemnity benefits are paid to the contractor directly and continue based on the disability. Most contractors working overseas earn the maximum compensation rate, which increases slightly every year and continue based on the impairment. Oftentimes, payments of compensation are paid for life depending on the type of injury (unscheduled scheduled injuries) and if that injury prevents you from returning to your overseas employment.
Medical benefits will cover necessary treatment following the injury that resulted in the DBA claim. Oftentimes settlement discussions are initiated by the insurance company. Of course, the insurance companies will attempt to settle the case for the lowest amount possible. I regularly hear how insurance companies attempt to settle serious spine injury cases for under $50,000. No private military contractor should settle the case alone without an attorney. Insurance companies use many tactics to bring down expectations as to the value of the settlement. For instance, carriers will reduce the indemnity (compensation) paid to the military contractor and attempt to force the employee into accepting a lower settlement value. They may also attempt to find out what the expectations of a settlement are from a contractor who really has no idea as to the value of the settlement including loss of future earnings, cost of future medical care, etc.
The methods DBA insurance carriers use to pay as little as possible are endless. You need a DBA lawyer who recognizes these tactics and knows how to defend against such tactics and who knows how to maximize the value of claims. I have worked as an insurance company defense counsel and I am keenly aware of the insurance company tactics. I am also a U.S. Army Ranger Veteran and I am known for fighting for the rights of my clients and maximizing DBA settlements nationwide.
In most cases, it is beneficial for the injured worker to consider an adequate lump sum settlement. For instance, the law could change, which may impact the value of settlements. Insurance companies are the largest group of lobbyists in the country. Even minor changes to the Longshore and Harbor Workers’ Compensation Act and the Defense Base Act, may significantly cut the value of DBA claims.
Second, most injured workers do not want the insurance companies on their backs for as long as being paid the regular compensation. Insurance carriers regularly hire investigators to try to catch workers doing activities that they may consider being outside workers’ medical restrictions. I have had a case where insurance carriers hired a private investigator to place (illegally) a tracking device on the car of a client. If cases do not resolve, insurance companies will do what they can to terminate compensation, including regularly setting clients to attend indepdent medical evaluations (IMEs), which technically are not “independent” as these doctors are paid regularly by insurance companies and are regularly are paid $2,000 – $5,000 for each IME. Nobody wants an insurance carrier in their lives forever.
Further, if an injured worker dies while receiving compensation through no relation to the claim, all compensation stops. This may be disastrous if an injured worker has a family. If an injured worker sustains another injury while receiving compensation pursuant to the DBA, the compensation may also be terminated. For instance, if you are on DBA for a lower spine injury and you are involved in a car crash and sustain serious shoulder injuries, your DBA compensation will likely cease if the insurance company receives a medical opinion that the shoulder injury would also prevent you from returning to work overseas.
In conclusion, lump sum settlements are in the injured workers best interest, but only if the lump sum settlements are adequate.