Demographic Factors and Severe Injuries

Posted Date: August 2005

Workplace accidents that result in fatality or permanently disabling injury are not only the most personally and emotionally devastating, they also comprise the most expensive workers compensation claims.

In these cases, workers compensation insurance typically provides for a lifetime award to the injured worker or to a surviving spouse as compensation for lost income, and all current and future medical care to the injured worker is covered in full.

While these severe cases represent only about 1.1% of workers compensation injuries that involve compensation for time lost from work, they represent 11.4% of the costs. The comparatively rare nature of these serious events, combined with the length of time over which benefits are paid, makes it difficult to estimate their eventual cost.

More so than for minor workers compensation injuries, claimant demographics such as age and gender typically dictate the cost of workers compensation claims for severe injuries. Also, small differences in the rate of long-term medical inflation can cause large differences in total claim costs.

With some types of severe injuries, modern medical care and consequent confinement may even extend the life expectancy of the injured worker. An injured worker under age 20 may live for nearly a century, and the claim costs, particularly the medical bills, might grow every year.