If you’re navigating a New York workers’ compensation claim, you may eventually be offered a Section 32 settlement. These agreements can be beneficial, but they also require careful consideration because they permanently close parts of your claim. Understanding what you’re agreeing to is key.
Before deciding whether to settle, it’s essential to understand what a Section 32 Settlement is and how it may affect your long-term medical and financial rights.
What Is a Section 32 Settlement?
A Section 32 Settlement, also called a Section 32 Waiver Agreement, is a negotiated lump sum agreement between an injured worker and an insurance carrier under New York Workers’ Compensation Law. This agreement ends your right to ongoing and future workers’ compensation benefits in exchange for a one-time payment. The Workers’ Compensation Board must approve all Section 32 Settlements before they become final. The payment is generally tax-free under IRS Code §104, providing you with a clear financial resolution to your workers’ compensation claim.
Key Benefits of a Section 32 Settlement
Section 32 Settlements offer several advantages for injured workers. You receive an immediate lump sum payment rather than waiting for ongoing weekly benefits. This provides financial certainty and allows you to plan your future with confidence. The settlement brings closure and finality to your case. It eliminates ongoing disputes with the insurance carrier about medical treatment or wage calculations. You gain flexibility in how you use the settlement funds, whether for medical care, living expenses, or other needs. Additionally, a workers’ compensation settlement avoids prolonged litigation and appeals. You can move forward without the stress of ongoing legal proceedings.
Important Risks and Drawbacks to Consider
Before accepting a Section 32 Settlement agreement, you must understand the significant drawbacks. Once approved by the Workers’ Compensation Board, the settlement is permanent and irreversible. You permanently waive your right to future medical benefits and indemnity payments for your work-related injury. You cannot reopen your case for the same injury under any circumstances, except in extremely rare cases involving fraud or misrepresentation. The lump sum amount may be substantially less than the total value of lifetime benefits. This is especially true if your injury worsens or requires ongoing treatment. You also lose ongoing medical coverage for your work-related condition. This could create financial hardship if your injury requires future care.
How Is a Section 32 Settlement Amount Calculated?
Section 32 settlements are negotiated agreements in which the insurance carrier pays a lump sum to close some or all aspects of a workers’ compensation claim. In evaluating the settlement amount, the carrier considers its potential future financial exposure, including likely future wage-replacement benefits and medical costs. The worker’s level of permanent disability, any established loss of wage-earning capacity, and any applicable schedule loss of use findings can influence the valuation. The strength of the claim, liability issues, and litigation risks are also factored into negotiation. An experienced workers’ compensation attorney can review the carrier’s projections and negotiate a settlement that fairly reflects the ongoing impact of the injury.
When Should You Consider a Section 32 Settlement?
A Section 32 Settlement may be appropriate if your injury has reached maximum medical improvement. Your medical prognosis should be stable and clear. If you have alternative health insurance coverage or stable income from other sources, you may not need ongoing workers’ compensation medical benefits. You should consider a workers’ compensation settlement if you want certainty and closure. This is preferable to ongoing disputes with the insurance carrier. If you have already received substantial medical treatment and your condition is unlikely to worsen, a lump sum settlement provides financial resolution. Additionally, if you and the insurance carrier have reached a fair settlement amount, accepting the settlement allows you to move forward.
When Should You Avoid a Section 32 Settlement?
You should avoid a Section 32 Settlement if your injury may worsen or require future treatment. If your medical prognosis is uncertain or you are still undergoing active treatment, accepting a settlement prematurely could leave you without coverage for necessary care. You should not accept a Section 32 Waiver Agreement if you have not yet reached maximum medical improvement. Your condition may change significantly. If your injury may require substantial long-term medical care or ongoing treatment, the lump sum amount may prove inadequate. Additionally, if the insurance carrier’s settlement offer does not adequately reflect your injury’s impact on your earning capacity and medical needs, you should continue negotiating. Pursue your claim through the Workers’ Compensation Board.
Frequently Asked Questions About Section 32 Settlements
Below are answers to some of the most common questions people have regarding Section 32 settlements.
Can I reopen my case after accepting a Section 32 Settlement?
No. A Section 32 Settlement is permanent and final. Once the Workers’ Compensation Board approves your settlement, you cannot reopen your case for the same injury under any circumstances. This finality is one of the most important aspects of a Section 32 Waiver Agreement. It underscores why careful consideration before accepting is essential.
What happens to my medical benefits after a Section 32 Settlement?
The treatment of medical benefits depends on the specific terms of your settlement agreement. Some Section 32 Settlements preserve your right to ongoing medical treatment for your work-related injury. Others waive all future medical coverage. You must carefully review your settlement agreement. Understand whether medical benefits are preserved or waived. This distinction significantly impacts your long-term financial security. Consulting with an experienced workers’ compensation lawyer can help clarify these terms.
Do I need an attorney to negotiate a Section 32 Settlement?
While you are not legally required to have an attorney, hiring an experienced workers’ compensation attorney is strongly recommended. An attorney can negotiate with the insurance carrier to maximize your settlement value. They ensure all your benefits are properly accounted for. Your attorney protects your long-term interests. They guide you through the Workers’ Compensation Board approval process. An attorney also helps you avoid costly mistakes or accepting unfavorable settlement terms. Our team at Fusco, Brandenstein & Rada, P.C. has extensive experience with Section 32 settlements.
How long does it take to receive my Section 32 Settlement payment?
After the Workers’ Compensation Board approves your Section 32 Settlement, the insurance carrier must postmark your payment within 10 calendar days from the date the agreement becomes final. In most cases, you receive payment within approximately 3 weeks from the approval hearing. An attorney can help expedite the process and ensure timely payment.
Why You Should Consult with an Attorney
Consulting an experienced workers’ compensation attorney before accepting a Section 32 Settlement protects your rights and maximizes your compensation. An attorney ensures accurate benefit calculations, negotiates with the insurance carrier, guides you through the approval process, and helps you avoid irreversible mistakes—especially settlements that fail to reflect the true impact of your injury on your earning capacity and medical needs. Because a Section 32 Settlement is permanent, professional legal guidance is essential.
If you are considering a Section 32 Settlement for your workers’ compensation case in New York, call Fusco, Brandenstein & Rada, P.C. at 516-496-0400 or contact us online for a free consultation. We’ll help you make an informed decision. You can explore our client testimonials to see how we maintain professionalism in every case we handle.