California is one of only a few states that maintain a dedicated insurance fund for payouts to employees injured on the job. Workers compensation settlements in California can vary greatly in size and expediency, and injured workers must be prepared to fight against employers motivated by the high–and growing–cost of workplace accident insurance.
This is not true for all employees. The handling of workers' compensation claims can vary based on the type of occupation and employer. For example, federal employees in California are going to have their claims handled very differently than state workers under federal law. Also, some occupations such as those that work for the railroad, as longshoremen, other harbor workers, on commercial boats, or for the military will have their claims handled differently.
California's State Compensation Insurance Fund, locally known as the "State Fund", handles a plurality of workers compensation settlements in California. Several other insurance companies in the state offer workers compensation insurance to employers, but none has the influence and reach of the State Fund, which holds itself up as a model for other insurance agencies.
The Fund attempts to balance the needs of injured workers and their employers, offering full support in the fight against supposedly fraudulent claims as well as worker-friendly incentives like "return to work" programs and bonuses or discounts for employers who improve safety conditions in the workplace.
While the State Fund is generally seen as providing fair coverage and affordable policies for California employers, both injured workers and companies carrying State Fund insurance regularly complain about the speed of its claims process. Consolidation and layoffs both in the statewide insurance industry and at the State Fund itself have decreased the expediency of claims, with some injured workers waiting months to receive their final settlement.
In addition, recent law changes have made lump–sum settlements for injured California workers are rare except in cases of permanent disability; it's more likely that employees will receive a portion of lost wages periodically until they can work again.
Due to California's centralized workers compensation system and the backlog of cases in state courts, settlements are more common here than almost anywhere else. Cash-strapped workers facing an unsure future may be tempted to take an arbitrated settlement to cover expenses coming due.
Though these settlements may be quite large and may seem fair, they are almost always low–balled at the behest of the State Fund and other insurance companies. As a result, workers should consult an experienced workers' compensation attorney to fight for their legal rights.
The other drawback to immediately accepting workers compensation settlements in California is that such acceptance signifies a worker's forfeiture of "rights of future recovery." In other words, anyone who accepts a workers compensation settlement based on a single workplace injury or disease forfeits their right to any future settlement should new symptoms or disabilities arise from the injury, as is sometimes the case with repeated exposure to inhaled toxins or vertebral fusions caused by spinal injuries.