WC & Structured Settlements - District of Columbia

Arcadia Settlements Group January 2019
Workers’ Compensation FAQs
District of Columbia

Structured Settlements and Workers’ Compensation in the District of Columbia

Employers/insurers using structured settlements save an average of 30% compared to the lump sum
cost. Annuities are used to provide future payments, typically guaranteeing medical benefits for the
injured employee’s remaining life expectancy. This approach allows employers/insurers to control claim
severity, while also providing security and access to quality care for the injured employee. FAQs about
settling indemnity and future medical claims with structured settlements are presented below:

Can you resolve a WC claim with a structured settlement?
Yes, structured settlements are allowed. Parties may use a structured settlement in an
agreement with open or closed medicals. Settlements must be approved by the Office of
Workers’ Compensation (OWC) – Claims Processing Unit, before they become binding.

Will the use of a structured settlement require court approval?
No, just like a cash lump sum settlement, only approval by the Claims Processing Unit is needed.

What is the review standard for settlement agreements?
The settlement agreement must show that it is in the best interests of the injured employee.

Is the employer/insurer contingently liable when using a structured settlement?
No, in fact, the employer/insurer saves an average of 30% on future medical benefits costs.

Will a structured settlement result in a complete release?
Yes, the settlement agreement is “full and final” once approved by the administrative body.

What type of structured settlement products may be used (i.e., Qualified Assignment,
Non-Qualified Assignment, Reinsurance, or Unassigned Annuity)?
The Claims Processing Unit allows the involved parties to choose which structured settlement
product to use. Only products shown to be in the best interest of the claimant will be approved.

Are there mechanisms to protect the interests of structured settlement recipients?
Yes, the D.C. Council approved the Structured Settlements and Automatic Renewal Protections
Act (SSARPA) of 2018 and it is expected to become effective following mayoral approval and
standard congressional review. D.C will join 49 other states with similar laws designed ensure
that any exchange of future settlement payments for discounted immediate cash payments will
be in the annuitant’s best interest.