Glossary Of Workers Compensation Terms

Workers' Compensation Terms

• Accident

  An unplanned, unforeseen event causing injury or illness at work.

• Acute Injury

  Injury with sudden onset (e.g., broken bone).

• Aggregate Limit

  Maximum amount an insurer will pay for all claims in a policy period.

• Agreed Medical Examiner (AME)

  Physician selected jointly by insurer and employee to provide an impartial medical evaluation.

• Average Weekly Wage (AWW)

  Average of employee's earnings used to calculate indemnity benefits.

• Beneficiary

  Person entitled to receive WC benefits in case of employee death.

• Body Part Schedule

  Lists specific body parts and assigned compensation for permanent partial disability.

• Burden of Proof

  Responsibility to demonstrate that the injury is work-related.

• Claim

  Request for workers' compensation benefits due to work-related injury or illness.

• Claim Administrator

  Company or insurer that manages WC claims.

• Compensable Injury

  Injury recognized under WC laws as eligible for benefits.

• Compensability

  Determination whether a claimed injury or illness qualifies for WC coverage.

• Compensation

  Payments to employee for medical care, lost wages, or disability.

• Contributory Negligence

  Employee's own negligence may reduce or deny benefits (rare in WC, depends on state).

• Cost of Claims

  Total expenses associated with a WC claim, including indemnity, medical, and legal fees.

• Death Benefit

  Compensation paid to dependents if an employee dies from a work-related injury.

• Dependent

  Family member eligible for death benefits.

• Delayed Injury

  Injury whose effects appear over time (e.g., repetitive stress injuries).

• Disability

  Physical or mental impairment resulting from work-related injury.
  . Temporary Total Disability (TTD)Full wage replacement during recovery.
  . Temporary Partial Disability (TPD)Partial wage replacement while partially working.
  . Permanent Partial Disability (PPD)Permanent impairment affecting work capacity.
  . Permanent Total Disability (PTD)Employee unable to ever return to work.

• Disfigurement

  Cosmetic or structural injury recognized in certain states for compensation.

• Employee

  Individual covered by WC for work-related injuries.

• Employer Liability Insurance

  Insurance covering employer if WC coverage is not in place or limits exceeded.

• Employer's First Report of Injury (FROI)

  Report submitted to insurer or state agency detailing workplace injury.

• Exposure

  Potential contact with conditions causing occupational disease or injury.

• FROI (First Report of Injury)

  See Employer's First Report of Injury.

• Functional Capacity Evaluation (FCE)

  Assessment of employee's physical ability to return to work.

• Fraud

  Intentional misrepresentation of facts in a WC claim (employee or employer).

• Impairment Rating

  Physician's assessment of permanent loss of function, often expressed as a percentage.

• Indemnity Benefits

  Wage replacement payments to injured employees.

• Industrial Disease / Occupational Illness

  Illness directly caused by workplace exposures or conditions.

• Investigation

  Process of determining facts related to the claim, including cause, extent, and eligibility.

• Light Duty / Modified Duty

  Work within employee’s physical restrictions during recovery.

• Lien

  Legal claim against a WC settlement for unpaid medical providers or services.

• Medical Benefits

  Payment for necessary medical care related to a work injury.

• Medical-Only Claim

  Claim with no lost time beyond first three days; typically only medical expenses are paid.

• Medicare Set-Aside (MSA)

  Portion of WC settlement allocated for future medical expenses that Medicare would cover.

• NCCI (National Council on Compensation Insurance)

  Provides WC statistical data, rates, and classification codes.

• No-Fault Insurance

  WC is generally no-fault, meaning benefits are paid regardless of negligence.

• Occupational Disease

  Illness arising from the nature of employment.

• Overpayment

  Benefits paid beyond what is entitled; may be recovered.

• Permanent Impairment

  Long-term reduction in body function due to injury.

• Physician of Choice

  Employee's right in some states to select treating physician.

• Pre-Existing Condition

  Health condition existing before employment; may impact WC benefits.

• Prescription

  Duration and type of treatment prescribed by medical provider.

• Rehabilitation

  Medical and vocational services to return employee to work.

• Reserved Claim

  Claim not yet accepted; liability remains under investigation.

• Return to Work (RTW)

  Employee resuming employment following injury or illness.

• Settlement

  Agreement to resolve a WC claim for a lump sum or structured payments.

• Self-Insured Employer

  Employer assumes financial responsibility for WC claims instead of buying insurance.

• Subrogation

  Insurer’s right to recover WC costs from third parties responsible for the injury.

• State Fund

  Government-managed WC program providing benefits and coverage.

• Temporary Disability

  See TTD/TPD.

• Third-Party Claim

  Claim against a party other than employer or insurer responsible for injury.

• Total Disability

  Employee cannot perform job duties at all.

• Transitional Work

  Program providing modified duties during recovery.

• Utilization Review (UR)

  Process to evaluate necessity, appropriateness, and efficiency of medical services.

• Unknown Injury / Latent Injury

  Injury discovered long after exposure or incident.

• Vocational Rehabilitation

  Services to retrain employee or find new work if unable to return to previous job.

• Vocational Evaluation

  Assessment of employability and skills following injury.

• WC (Workers’ Compensation)

  Insurance program providing benefits for work-related injuries and illnesses.

• Wage-Loss Benefits

  Payments to replace a portion of lost earnings.

• Waiting Period

  Initial period before WC wage benefits begin (often 3 - 7 days).

• Witness Statement

  Written account from coworkers or others regarding incident.

• Yearly Aggregate Limit

  Total maximum benefits payable in a 12-month period.

• Zero-Day Claim

  Claim closed without any lost-time benefits; may include only medical treatment.