Generally speaking when a matter is settled, the client and insurer will enter into a Deed of Settlement. A Deed of Settlement ordinarily obliges an insurer to pay the agreed compensation to a client within 30 days.
Prior to the compensation being received by a client, any statutory refunds (being monies owed by the client to WorkCover (on account of any benefits paid during the client’s rehabilitation process), Centrelink (on account of any pension or social security the client may have received whilst injured) and Medicare (on account of medical treatment the client may have received while injured) will be deducted from the settlement sum prior to its receipt by our office. It is critical to identify what these costs are well prior to the negotiation of a settlement in addition to the legal, medical and barrister fees that will be payable by the client up to and including the date of settlement.
Without properly identifying and quantifying these costs the client is literally “flying blind” when negotiating a settlement as they do not have adequate information to identify what the net settlement (ie. we like to call “back pocket dollars” – being the dollars that our clients put in their back pocket after the payment of all expenses and refunds) are to be received. We appreciate that for most of our clients it is critical for them to understand and have a good grasp of what the back pocket dollars are prior to agreeing to a settlement.