SUBROGATION - WC and MVA claims

Under Pennsylvania law, an injured worker can not "double dip." This means that an injured worker cannot receive double payment of benefits for a car accident, from both the Third Party  [the negligent driver who caused the accident] and the workers compensation insurance company. The workers compensation insurance company is entitled to recover the money they paid to the injured worker from the employees Third Party lawsuit. This is called subrogation. It applies to the wage loss benefits and medical benefits paid by the workers compensation insurance company.

If the amount of money recovered from the Third Party lawsuit is less than the total amount paid by the workers compensation insurance company (both past and future), the workers compensation insurance company may recover ALL of the Third Party settlement (after attorneys fees are deducted). Because an injured worker is not "required" to pursue a claim solely for the benefit of the workers compensation insurance company, there are frequently situations where the insurance company will "compromise" the amount of their recovery, to provide incentive for the claimant to proceed with the case against the Third Party. Otherwise, the injured worker might simply decide to "drop" the Third Party lawsuit, leaving the insurance company with no recovery at all.

If the amount of money recovered from the Third Party lawsuit is greater than the amount of workers compensation benefits paid, there are several different possibilities. If the workers compensation claim is closed, and there are no further benefits being paid, then the insurance company is only entitled to recover up to the total amount they paid. Any greater amount is payable to the injured worker. [Once again, this is after attorneys fees are paid.]  HOWEVER, if the workers compensation insurance company is continuing to pay benefits to the injured worker, there is a mathematical formula to be applied to the Third Party money recovered. The injured worker will receive less weekly wage loss benefits, and may even be required to pay a portion of their medical bills, until the full amount of the Third Party Recovery is "absorbed" (based on the Worker's Compensation Company paying less money).

In addition to benefits payable by the insurance company for the negligent driver, an injured worker may also have Underinsured (or Uninsured) motorist benefits on the policy of the car they are in. If that insurance policy was paid for by the employer, subrogation may apply to any benefits recovered in the UM/UIM claim, as well. However, if that car insurance policy was paid for by the injured worker themself,  then the workers compensation insurance company does NOT have a right of subrogation. Standish v. American Mfrs Mutual Ins. Co., 698 A.2d 599 (PA Super 1997); Entertainment Partners v. WCAB (Caparelli), 749 A.2d 551 (Pa Cmwlth  2000); American Red Cross v. WCAB (Romano), 745 A.2d 78 (Pa Cmwlth. 2000). COMPARE: Schwaab v. WCAB (Schmidt Baking Co.), 832 A.2d 1164 (Pa Cmwlth. 2003).

[Note: there are different "rules" where the UM/UIM benefits are paid for by someone OTHER THAN the injured worker or employer.]

If you have been injured in a work related car accident, you NEED the advice and skill of a TEAM of attorneys, knowledgeable in both Workers Compensation claims AND Motor Vehicle Accidents, in order to maximize your recovery under these separate sections of Pennsylvania Law. The law offices of Schmidt, Kirifides & Fridkin have Trial Attorneys, EACH  with over 20 years of experience handling these unique claims. For a FREE consultation, call us toll free at 877-268-6466 or contact us online at SKFtrialattorneys.com.  With offices in Philadelphia, Media and Wilmington, DE - there is a location convenient for you.