How much is my Defense Base Act case worth?
What is the value of my DBA case?
How much should I settle my Defense Base act case for?
If you have a Defense Base Act case, then at some point in time you are going to, first, think about settling your case and, second, try to determine whether to accept a settlement offer for a lump sum settlement. That is what this article is about. I suggest you pull up and chair.
This is a two part article - be sure to check out this article on DBA lump sum settlements.
“When I seek out professional advice, I don’t want B.S. I want it straight up, with no double talk. I figure do also. I always use plain English, with no sugarcoating no B.S lawyer talk, and no double talk- just old fashioned, unsweetened, unvarnished truth-just the way that I would want it.” - Defense Base Act Lawyer Bill Turley
Am I getting low-balled on my DBA settlement?
Most Defense Base Act cases are resolved with a settlement, rather than through litigation (which is another way of saying - a trial where the Judge decides whether you win or lose and if you do win, how much you get). This is because at almost any point during your case, you (or your attorney) can make a deal with DBA insurance company to settle your case. Hopefully, to get you the best deal considering the circumstances of your case.
Most folks are concerned about getting a reasonable or fair settlement. What is "reasonable" or "fair" depends on a lot of different factors. Based on what I see, at some point you may be faced with a difficult decision. Rarely will the DBA insurance company agree to pay anything close to what you may receive based upon the value of your claim if you play out the math, so to speak.
Then you are going to have to decide whether you want to be in it for the long haul or settle your case for what is being offered by the DBA insurance company. I tell clients that they either have to bet for themselves or against themselves. Not an easy question.
In the simplest terms, this means that do you think that you can do better over the course of your life in regards to earning wages than the weekly payout that you may receive from your DBA case?
Of course, there are many factors that go into this. Are you fed up with having to deal with the insurance company? Are you ready to move on with your life? Do you have other means to get medical treatment? If not, how much (i.e., what is the value of your future medical treatment? Are you angry with the DBA insurance company and want to stick it to them? Are you prepared to go the long-haul and not get benefits for possibly a few years while you are waiting for your trial and then for the Judge to issue a Decision?
Based on what I see, at any moment the DBA insurance company can stop your weekly compensation benefits. All they have to do is file a LS-207 - Notice of Controversion. You need to be thinking/planning ahead for this, and understand that they cut folks off, for no good reason, all the time.
You are probably asking yourself these questions:
How much is my Defense Base Act case worth?
What is the value of my Defense Base Act case?
How much should I settle my DBA case for?
These are all good questions.
Putting things in the proper perspective when evaluating how much your case is worth
In order to address these questions we first have to take a quick look at what a Defense Base Act case is. It is a court case. You will have a trial. Meaning, that you will get a chance to present your evidence and the insurance company will get a chance to "put on" their evidence. You have the burden of proving your case. The insurance company only has to poke holes in your case or your evidence and you will either lose, or not get the money you were hoping for.
The law calls the insurance company's contentions, "defenses." So in order to evaluate what your case is worth you need to not only assess the relative strength of your evidence, but also the relative strength of the DBA insurance company's defenses. Other than attacking your credibility and character, the Judge is going to make both sides give the other side their evidence and contentions before your trial.
The problem here is that you both are going to have to "show your hands" at the same time. Thus, you are going to have to try and anticipate their defenses and have your evidence ready to respond to their contentions and proof.
Sort of like "read 'em and weep." Only there is a whole lot more money involved with your case than most folks actually ever see in a poker game.
The point you need to understand is it is sort of like a football game. Just because you're ahead in the second quarter, doesn't mean you're going to win the game. And if you're behind, you had better be able to make "in game" adjustments.
The "wild card" here is your credibility and character. Remember, some Judges aren't going to make the insurance company give up or show their credibility and character evidence ahead of the trial. Not to suggest that you won't get some heads up on it. The defense doctor's reports attacking you and the Labor Market Survey report attacking you will be produced and you'll get a good idea of some of their attacks on your credibility and character. And most DBA lawyers that have had proper training and instruction are going to be evaluating the evidence in your case looking for these credibility / character issues.
But you might not know the full extent of their attacks on your credibility and character until you are on the witness stand and having the "hammer" dropped on you. Not fun. Nor pretty to watch from your attorney's chair in the courtroom either.
Which is why, it is so important for you to get a free copy of my book Win Your Defense Base Act Case and learn it and study it, before you start making all of the mistakes that will be used as a hammer against your credibility and character at trial.
Need help now?
You can call us at 619-304-1000 or fill out the contact form on this web page.
Let's talk time (you don't want to be living out of your car by the time your Judge issues a Decision from your DBA trial)
Remember, I mentioned that the Judge is going to make both you and the DBA insurance company show each other your evidence and tell each other your legal and factual contentions BEFORE your trial. Usually this is 60 days before trial.
DBA cases are usually very, very slow. Thus, you may have to wait a year or more (sometimes much more time) before you are going to be at the point where both sides have to reveal their evidence.
Just as bad. Most Judges are so backed up that it is another 6 to 12 months after your trial, before the Judge issues a Decision. And if you do win at trial - that is you are Awarded benefits, the insurance company is going to drag your case out for years by appealing the decision.
Therefore, you need to be in a position that you can hunker down and withstand the long wait. You need to realize this as early as possible. Thus, if (or rather when you're benefits are cut off); you are ready. The last thing you want is to be "pushing a shopping cart" or living out of your car due to all of this.
I realize that I'm probably the only lawyer that is going to tell you all of this. And you're probably are looking for sunshine, magic pixie dust and fairy tales and the like.
But, I'm all about being no B.S. and being a straight shooter.
The earlier you hear the facts of life the better prepared you are going to be. Frankly, I have too many good, honest folks that have called me after they are out on the street after having lost it all. I don't want you and your family to have to live through that.
This is all another reason for you to be putting in your major effort in finding the best DBA lawyer you can. You don't want to be that guy or gal.
What are the factors that help determine the value of my Defense Base Act case?
Any settlement you accept must be approved by either the Department of Labor or the Administrative Law Judge. The Department of Labor claims examiner or the judge will use a number of factors to decide if the Defense Base Act settlement is reasonable, including:
- Medical evidence. Your medical records are key to proving your Defense Base Act claim, so it is vital that you get treated for your injuries as soon as possible and continue to receive ongoing medical treatment. The judge in your case will examine your injuries and disabilities carefully and decide whether you have any impairment ratings that will qualify you for benefits.
- The relative strength of the medical evidence. The better written and reasoned medical reports you have that lay out your injury, your disability and how your disability was caused by and/or contributed to by your being overseas is crucial. Too often I see doctors write medical reports as a conclusion. You need a well written medical report that explains how you were injured, how your injury is related to you being overseas, and the nature and extent of your disability. Meaning, why you are no longer able to perform your usual and customary occupation.
- The relative strength of the insurance company's doctor's opinions and/or report. The insurance company likes to call their hired doctor an "IME." Which stands for Independent Medical Examination. Which would be a joke, other than it is being used to take food off of you and your family's table. There is nothing independent about it. It is essentially a doctor that has been hired by the insurance company to poke holes in your medical evidence. One of the key factors in determining the value of your case is comparing your doctors medical opinions with the insurance company doctor's opinions. That is, evaluating the medical evidence. It is, most likely, what the Judge is going to do in order to determine whether you win or lose.
- Your proof on how your injury was caused by you being overseas. This can be an incident report, an email, a witness, there are any number of ways of proving you were injured overseas.
- Labor Market Survey. A Labor Market Survey report that is going to be used by the DBA insurance company to lessen the value of your case. it is one of the things that will be reviewed in order to determine the value of your case. It is used to diminish your wage earning capacity.
- Loss of wage earning capacity. The court will examine whether you have returned to work on a full- or part-time basis, or if there is other work that you can perform with your injuries. If you have an unscheduled injury, and you are unable to return to your usual and customary occupation (Read: you work as an overseas civilian contractor); then you may be entitled to a weekly disability payment/ award if you have a loss of wage earning capacity. This is a wage loss concept that determines the value of your permanent disability claim.
- Disputed issues. Any disputed facts in your case could potentially result in a lower settlement. If you and your employer disagree with any points, it is vital that you have as much evidence on your side to convince your judge of your account of the story.
- Your credibility. I say it again and again - nothing is more important than your credibility. Nothing else is even close. You can have the best medical evidence, the best witnesses, the best incident reports and blah, blah, blah..... and all of that may not matter if the Judge doesn't believe you. This is why I preach like a mantra - "Always tell the truth." In every case, the DBA insurance company is going to attack your character. You can depend on it. One of the biggest factors in determining the value of your case is what evidence does the insurance company have that affects your credibility/ character.
- What if I have a scheduled injury? The evaluation of a scheduled injury under the DBA is very different than an unscheduled injury.
- Stipulations vs. Settlement. You and the DBA insurance company may enter stipulations or a agree to a settlement. Examples of common stipulations include whether a person is eligible to receive ongoing or future medical benefits and agree to a weekly amount per week. These are much less common. With a settlement you will be paid a lump sum for a permanent impairment rating.
- Medical treatment. The type, costs and frequency of future medical treatment is important in determining the value of your future medical.
No simple formula
I'd like to tell you that there is a simple formula for figuring all of this out. But there isn't. It all has to be evaluated and sifted through. It's one of the reasons why you need to find the best, honest DBA lawyer that will agree to take your case.
Check out all of the 5 Star reviews at amazon.com here.
This why I strongly suggest that you put the majority of your efforts into finding and hiring the best honest DBA lawyer. I tell you how to do this in my book.
I realize many of you may want more than this. You want an definitive answer: should I take the DBA insurance company's settlement offer?
It may come down to your risk tolerance. And how long you can make it if the DBA insurance company cuts you off?
Not to come back to the same point, but this really bears repeating. Is there any evidence that may affect your credibility? I suggest you start here first. All of the factors that I listed (see above) are things that you are going to need in order to assess your case. But, there is one more thing you need to consider.
Need help now?
You can call us at 619-304-1000 or fill out the contact form on this web page.
Where is your case venued and who's the Judge?
Many, if not most DBA cases are settled in mediation now days. Cases are settled with mediators. One of the first questions the mediator is going to ask is where is your case venued and who is the Judge? The mediator isn't asking this for fun. These are both crucial questions in determining the value of your claim.
Venue refers to where the court will be for you case. If this all sounds dry and not so important, I suggest that you reconsider. Right about now would be a good time to listen up.
Where you case is venued is determines what law may be applied to your case. The United States has different Courts of Appeal. Different Courts of Appeal have different case law than other Courts of Appeal. For example, the Ninth Circuit Court of Appeal (the West Coast states) may have far different law on some DBA issues than, say, the Fifth Circuit - for example if you're in Texas.
Another factor related to venue is what Compensation District you are in. This determines what panel of Administrative Law Judges that will hear your case.
What Judge you are assigned can very much determine whether you win or lose. You may not think that is fair or right, but it is what it is. It's your reality now.
It doesn't matter if you see yourself as conservative, liberal or whatever. This is what you need to consider before settling your DBA claim.
The important part for this discussion is that you need to be aware that these may be issues in your case. It's another reason why it's difficult to tell you whether you should accept a settlement or not.
I know a lot of you aren't going to like me telling you all of this. But my job is to tell you what you need to hear - not what you may want to hear. That's the way I want people to deal with me. I figure you do also.
More on your credibility/ character
If you've read my book Win Your Defense Base Act Case (if you haven't you MUST get a copy asap) and/or read much of this website, you will hear me talk about the tricks and traps that DBA insurance company will try to use to trip up your DBA case. Most of these tricks and traps are designed to attack your credibility and character.
Evaluating your own credibility issues and/or character issues in an objective manner is usually difficult. Most folks initial reaction is understandably, anger. Then followed by disbelief and denial. Again, all of this is understandable. But, your emotions, only cloud the issues.
I'm sure that most of you don't want to hear any of this. I get that. But my job is to tell folks what they need to hear. Not what they want to hear. All that stuff about "No B.S., straight-talk" is fine for most people when I'm talking about the no-good insurance company and/or the insurance company lawyer. Maybe not so welcome when I'm talking about them. That is, my client.
You may or may not know about your credibility problems and/or character issues with your case. For instance, you could have fallen for one of the insurance company's tricks or traps and have no idea that you did.
But here is the deal. If you do know about potential credibility issues or character problems, you need to tell your attorney about them now. Often times they can be fixed or minimized. The last thing you want to have is for you to have given deposition testimony or get caught at trial without having had the chance to explain the issue or at least put it into the best perspective as possible.
What is present cash value (and what does it have to do with settling my DBA case)?
When calculating the value of your weekly permanent disability award, you will need to reduce it to its present cash value.
According to Investopedia the definition of "present cash value" is:
Present value, also called "discounted value," is the current worth of a future sum of money or stream of cash flow given a specified rate of return. Future cash flows are discounted at the discount rate; the higher the discount rate, the lower the present value of the future cash flows. Determining the appropriate discount rate is the key to properly valuing future cash flows, whether they are earnings or obligations.
This is not an easy concept to explain and if you haven't taken finance or higher level economics courses, I'll try and give you a more lay person's understanding.
We all know that generally the costs of good (say, milk) goes up over time. For example, a gallon of milk costs a lot more now than it did 30 years ago. You might say, "so what?" But if you get a weekly permanent disability award, you may be getting weekly disability benefits for your life. Thus, you will need to determine how many more years you're going to live. That is, your life expectancy.
Perhaps the best way to explain this concept is to look at it from the insurance company's point of view.
Suppose the insurance company owes you $500 a week for the rest of your life. That is $26,000 a year. This can be spread out over, say, 30 years.
The insurance company is thinking, given how well they invest money, how much money can they make if they invested that money ($26,000 times 30 years) over time? They can make really good rates of return because they have a lot of money and some very good folks helping them to invest their money wisely.
Remember, the insurance company is all about making money. So they are looking at the trade off between paying you a lump sum now and taking that money and investing it and seeing how much they can make off of the money that they may have to pay you over time.
The difference between chess and checkers
There is obviously a big difference between playing chess and checkers. On a finance level, the insurance company is playing chess. Meaning, there is a lot of things that factor into their decision to offer you an amount to settle your case.
You've got one claim. In many respects, your economic future is riding on one case. Your DBA case. The DBA insurance company may have hundreds, if not thousands of claims. They are playing the percentages. If they lose your trial, they will keep appealing until they run out of appeals. If they win, then they either get to go to trial again with your case and get a do-over or you may lose altogether.
In some ways it's a war of attrition. Meaning, that you can die. You can get tired of the DBA insurance company nickel and diming you over every medical visit or medical expense.
The DBA insurance company will be on you like "white on rice" to see if you ever earn more than your wage earning capacity as found by the Judge. This is the "do you bet for yourself or against yourself" issue that I try and explain.
In other words, the DBA insurance company is in it for over the long haul. They are factoring in things, issues, eventualities, possibilities, permutations and computations that you have never thought of. I'm not trying to in any way put you down.
I'm just trying to get you acquainted with this whole process.
So, when the DBA insurance company makes you an offer and it is quite a bit lower than what you were expecting or what you wanted, then you will have a better idea of how and why they got there.
They know how hard it is for folks to get by
You might think that the insurance company doesn't care about you're struggles to make ends meet. On one level, that is true. On another level it isn't true at all. Just for different reasons that you might have first thought.
The DBA insurance company knows full well the kind of money you were earning as an overseas civilian contractor. Dang good money, comparatively speaking.
They also know how hard it is to "make it" when you are living off a weekly disability check or if your benefits have been cut off and you're not getting any weekly DBA money.
They care because they know that you and your family having a rough time making it, is one of the main motivations of folks accepting lump sum settlements that are for a lot less money than what you believe the value of your case is. They are depending on this.
I'm not saying this is right. I'm just telling you the way it is.
Decisions made on statistical evidence vs. decisions made on emotions
The insurance company is making a decision on how much to offer you for settlement based upon calculations, statistics and formulations.
Too often, folks with insurance claims like DBA claims, make their decisions based upon either emotions or things that have absolutely no relationship to the value of your claim.
For instance, making a decision to settle your claim based upon how much your monthly mortgage payment is or how much your children's school costs are not relevant factors in determining the settlement value of your case. Nor is that you heard that Joe Smith got X amount for his DBA case and you want just as money as you heard Joe got. All of this is simply not relevant.
Playing the odds - in a way you're playing against the house (the DBA insurance company)...
Let me make one thing clear. I don't "gamble." At least, in the way that most people think of gambling. Meaning, I don't go to Vegas and gamble, I don't gamble on football or sports. No betting on the horses, etc.
But I do gamble. I gamble in court. Every time I take a case, I am, in effect - gambling. Just like you - if I lose a case, I don't get paid. Only I have a lot of cases. But, it is a form of gambling or risk-taking, nevertheless.
And, the insurance company is gambling also. Every time they take a case to court, they are gambling. Just like you and I. But they are a billion-dollar insurance company. They can afford to lose more than I can and they can certainly afford to lose more than you can.
The next point I want to make is that insurance company's make money by winning their bets. In that respect, they are professional gamblers. One of the things I do is I check out the cases. I keep my ear to the railroad track, so to speak. I try and see how specific Judges rule. I talk about that in this earlier in this article.
But, putting that aside for a moment, and putting aside that every case is different. Just because Joe Smith won his DBA case last week, doesn't mean that you are going to win your DBA case this week.
But, I am going somewhere with this discussion. And this is the point that I suggest that you consider. The DBA insurance companies are right more often than they are wrong. I read the cases. I see the DBA insurance company winning quite a bit more than they are losing. In that way, the "house" is the DBA insurance company - to use a Las Vegas gambling term.
Here is the reason why the DBA insurance companies prevail more at trial than do the Claimants (the overseas civilian contractors bringing the DBA claim, in other words, you). It is because, too often, the "good" DBA claims get settled and the "bad" or "difficult" cases end up going to trial. Because the DBA insurance companies aren't going to offer as much money to settle the "bad" or "difficult" cases.
The "bad" or "difficult" cases don't have as much settlement value as the relatively "better" cases.
Not to suggest that the DBA insurance companies are always right - because they most certainly are not. And I am certainly not suggesting that you settle for whatever the DBA insurance company is offering.
If you aren't satisfied with the settlement offer the DBA insurance company is making - then you need to figure - or, at least try and figure out - how the DBA insurance company is evaluating your case the way that they are.
You have to do what's right for your family
One of the most important factors you need to determine is whether you are able to take your case to trial. That is, whether you and your family is going to be able to survive long enough to win your trial and get your Award.
You have to be able to make it over the long haul. That is one reason why it is usually in your best interest to get a job while you are waiting for your case to go to trial.
It doesn't seem like a "win" if you get a good award from your Judge and you are homeless and living out of your car in the meantime.
I strongly suggest that you ratchet back your lifestyle and hunker down for the long haul if you are planning on taking your DBA case to trial. You have to be ready to make it over the long haul.
How Soon Could You Receive Your Defense Base Act Settlement?
After the court approves your settlement, your employer and insurance carrier has 10 days to issue the compensation to you. If you do not receive the payment within the 10-day period, your employer can face an additional penalty up to 20 percent of the amount you are owed.
I encourage you to download a free copy of our guide, Win Your Defense Base Act Case, to find out more about what steps to take next.
This is a two part article - be sure to check out this article on DBA lump sum settlements.
I know I covered a lot here. If you have questions or comments, please don't hesitate to call us or fill out the contact form on this webpage.
There are no guarantees in life or law. Just because we have gotten great results in other DBA cases, is no guarantee we will get a great result in your particular case. There are any number of reasons why you can lose your DBA case. Every case is different. In other words, your mileage may vary.