Waltham, MA, January 30, 2025 — A new report from the Workers Compensation Research Institute (WCRI) revealed a rise in the frequency of lump-sum settlements in New York after the 2007 workers’ compensation reforms. The percentage of indemnity claims settled by lump sum increased from 23% in injury year 2007 to 37% in injury year 2014, before slightly declining after 2015.

“This marked shift represents an important change in settlement behavior in New York,” said Sebastian Negrusa, vice president of research at WCRI. “This FlashReport provides a detailed look at settlement behaviors in New York and explores the policy changes and other factors driving these shifts.”

The study, titled Changing Settlement Behavior in the New York Workers’ Compensation System, also provides answers to key questions, such as the following:

• How have the frequency and costs of lump-sum settlements evolved in New York?
• What impact have policy changes had on settlement trends?
• How has the time from injury to settlement changed?
• What shifts have occurred in the use and costs of schedule loss of use (SLU) versus non-schedule awards?

Settlements of both indemnity and medical benefits are common in New York, especially in cases involving permanent partial disability (PPD) benefits. Understanding these settlements is critical as New York allows both SLU and non-schedule awards, determined by the specific body part affected by the injury.

The report’s findings are based on data from WCRI’s Detailed Benchmark/Evaluation database, which includes claims data from national and regional insurers and claims management organizations. The analysis covers open and closed non-COVID-19 indemnity claims from injury years 2005 to 2022, with claims evaluated from 12 to 60 months of maturity.

For more information or to purchase the full study, visit https://www.wcrinet.org/reports/changing-settlement-behavior-in-the-new-york-workers-compensation-system.

About WCRI:

The Workers Compensation Research Institute (WCRI) is an independent, not-for-profit research organization based in Waltham, MA. Organized in late 1983, the Institute does not take positions on the issues it researches; rather, it provides information obtained through studies and data collection efforts, which conform to recognized scientific methods. Objectivity is further ensured through rigorous, unbiased peer review procedures. WCRI’s diverse membership includes employers; insurers; governmental entities; managed care companies; health care providers; insurance regulators; state labor organizations; and state administrative agencies in the U.S., Canada, Australia, and New Zealand.

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